Payment tokenization is trending in a big way. In fact, the global tokenization market is projected to grow from $2.3 billion in 2021 to $5.6 billion by 2026.1
The main reason for this rapid growth is fairly straightforward. Replacing vulnerable payment card information with indecipherable tokens eliminates the need for businesses to transmit and store sensitive card data on their systems, which reduces the risks, liabilities, and negative impacts of data theft.
But payment tokenization, like most fraud and risk reduction technologies, also raises important questions: How does tokenization fit into and interact with your overall fraud strategy? Do you need to change your current fraud processes and rules to accommodate payment tokens? And maybe most intriguing, can modern payment tokens solve problems or add value beyond payment security?
Two Cybersource solutions working together—Decision Manager and Token Management Service—are ready to help you answer these important questions. Token Management Service brings the benefits of tokenization to your organization quickly. Then, Decision Manager provides the tools you need to identify risky transactions, make better payment decisions, and fine-tune your payment risk strategies across all your different channels and payment instruments, including tokens.
Tokens are not like other payment instruments
This notion of treating tokenization differently is important, because in many ways tokens need to be treated as their own, distinct payment instrument—with unique characteristics, capabilities, and threat vectors. For example, unlike payment cards, most tokenization fraud occurs when tokens are initially provisioned—not when they are used for individual transactions. With Decision Manager, you can create rules that screen new tokens for fraud when they’re first created, when they’re used for individual transactions, or both, depending on your requirements.
Protection before, during and after every payment transaction
Making tokenization a fully integrated piece of your overall fraud strategy—with its own distinct set of intelligent rules and processes—is one of the biggest reasons for bringing Decision Manager and Token Management Service together. But there are many others. When you add advanced tokenization to your overall payment fraud strategy, you also gain the ability to:
- Keep customer data encrypted and secure at rest and in transit, so it stays protected from breaches and theft through every step of the payment process.
- Unlock the advantages of top-tier, Visa grade security by only storing your customers’ PANs and card-on-file information in enterprise-level, tier-4 data centers—and never on your own systems.
- Use Decision Manager’s advanced artificial intelligence and machine learning to screen payment tokens for fraud—both when new tokens are provisioned and when existing tokens are used for transactions.
- Reduce your PCI DSS compliance scope with a token management solution that meets the strictest regulatory standards for encryption and data security.
Using Tokenization for more than data security
Tokenization has always been about protecting transactions and reducing payment data theft risks. But in 2022, there’s more to the story. Token Management Service also connects payments, customer data, and other network tokens together into one “super token,” which allows you to see and understand your customers’ shopping habits across payment methods, networks, and channels. This makes it possible to use tokenization to offer your customers more secure subscription service options, one-click checkout experiences across different channels, more personalized payment experiences, and a lot more. In other words, with Token Management Service, tokenization has evolved into a flexible and powerful new customer experience (CX) tool.
Reduce fraud and deliver better, safer payment experiences
The bottom line is that tokenization—delivered through Token Management Service—is ready to add safety and value to your business. Decision Manager is ready to make tokenization a natural, fully integrated piece of your overall fraud strategy. And Cybersource is ready to help you bring these two tools together in a way that makes sense for your business.
1 Marketsandmarkets.com, Tokenization Market Report