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Tokenisation rules for debit, credit cards kicks in

October 03, 2022

Tokenisation rules for debit, credit cards kicks in
The Reserve Bank of India (RBI) has made it mandatory for all credit and debit card data used in online, point-of-sale, and in-app transactions to be replaced with unique tokens by September 30 this year. This added layer of security by way of tokenisation is expected to enhance users’ digital payment experience. 

The deadline was extended multiple times over the past two years at the request of stakeholders and most recently by three months starting July so that the additional time period may be utilised by the industry in facilitating all stakeholders to be ready for handling tokenised transactions.
 
On September 30, RBI said about 35 crore cards have been tokenised and the system is ready for the new norms which will set in from October 1. The number of tokenised cards had gone up from 19.5 crore tokens created in June, according to data shared by RBI earlier. The extension was also given for creating public awareness about the process of creating tokens and using them to undertake transactions. 
 
Currently, many entities, including merchants, involved in an online card transaction chain store card data like card number, expiry date, etc. Card-on-File (CoF) citing cardholder convenience and comfort for undertaking transactions in future.
 
While this practice does render convenience, the availability of card details with multiple entities increases the risk of card data being stolen or misused and there have been instances where such data stored by merchants have been compromised. 

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