Q: What is tokenization?

A: Tokenization is the process of replacing a card’s primary account number (PAN)—the 16-digit number on the plastic card—with a unique alternate card number, or “token.” Tokens can be used for mobile point-of-sale transactions, in-app purchases or online purchases.

Q: What are the benefits of tokenization?

A: Tokenization reduces fraud related to digital payments by making transactions more secure by including a dynamic component with each transaction. It takes the security of a physical EMV chip and applies it to non-card environments including proximity, mobile and internet payments.

Merchants benefit from more secure transactions, as well as faster checkout experiences, new payment acceptance options and more ways to sell.

Q: How do I ensure that I can accept transactions from eligible devices?

A: Existing contactless terminals are compatible with tokenized transactions and no action is required. Mastercard offers merchants a free, optional service for a more secure in app payment acceptance called Digital Secure Remote Payment (DSRP). To use DSRP merchants must:

  • Contact their acquirer to ensure that they support DSRP
  • Integrate their mobile app with the digital wallet partner
Q: What is Mastercard’s role in the launch of digital wallets?

A: The new digital wallets connect into Mastercard Digital Enablement Service (MDES), so participating issuers can enable secure mobile payments on millions of devices.

Q: What do these new digital payments mean for me?

A: For consumers and merchants alike, every purchase made with a tokenized Mastercard debit, credit, prepaid or small business card using Apple PayTM, Google PayTM or Samsung Pay in the United States offers the enhanced security and benefits of a digital Mastercard transaction including secure tokenization technology.

Q: Will this affect the way that I identify new or returning consumers?

A: Merchants that use card numbers to identify customers will not be able to recognize returning customers if it is the first time they are using their token since it appears as a new card number. However, when used again, merchants will be able to recognize the token associated with the consumer’s device.