What you might not (but should) know about Visa Token Service

Tuesday, 20 Dec, 2022

Get into the world of Digital Token Visa.

Get into the world of Digital Token Visa.

Today, high chances are you will come across the term Token when emptying online shopping carts. Visa token services are seeing a sharp surge in demand as they help digital transactions (particularly those involving large cash amounts) secure and trouble-free.

So, what exactly is a Visa digital token? What makes a Token Visa card different? How does a Visa Token service function? Let's unriddle the Visa Token puzzle together with the article below.

First and foremost: What is tokenization?

The definition of tokenization explains why you should go for a Visa card

The definition of tokenization explains why you should go for a Visa card token.

Tokenization is a practice of substituting the 16-digit primary account number with a unique code, also known as a token, which allows customers to make payments without revealing credit card details to merchants.

Visa card payment gateways allow businesses to provide their customers with a simple and safe way to transact via mobile devices. With tokenization comes reduced data breaches, cardholder information protection, and secure digital transactions.

In payments, tokens are classified - high-value tokens represent the primary account number in a transaction and are used to close that transaction. On the other hand, low-value tokens act as backup codes and are not used to complete the transaction.

Next: Tokenization vs. Encryption

While both are powerful tools for reducing data theft risk, many people can not tell tokenization and encryption apart. So, what exactly is the distinction between tokenization and encryption?

Encryption is a type of cryptography that prevents unauthorized usage by making sensitive data illegible. It replaces each number, letter, and space on a card with a different one chosen by a sophisticated encryption algorithm.

The main difference between tokenization and encryption is that encryption can be decrypted. Encrypted data can be reversed back to its original form at any point – as long as you know the algorithm behind it.

Because encrypted information is reversible, the PCI Council considers it sensitive. Meeting compliance obligations with encryption is thus far more expensive than with tokenization.

Encryption is one of the strongest card data protection methods for card-present transactions. And yet, tokenization provides much better protection when it comes to payments where the card is not physically present.

To better protect data privacy and comply with PCI DSS requirements, experts recommend having encryption and tokenization working together.

What is Visa Token?

Token ID Visa helps payment data to stay ahead of fraudsters.

Token ID Visa helps payment data to stay ahead of fraudsters.

The Digital Token Visa has been instrumental in combating digital fraud and making digital payments more secure locally and remotely.

Using Visa tokens, it was possible to reduce fraud by 26% compared to traditional online card transactions that require a PAN at the point of sale.

Visa Inc. announced in February 2020 that its Visa Token participants had processed a combined $1 trillion of online retail sales, marking a significant milestone in its efforts to make e-commerce transactions frictionless and hassle-free.

Visa Token Service (VTS) encodes each customer's card number into Tokens, which are special characters that replace the customer's card information. Encrypting information into Tokens ensures absolute security for users when transacting, preventing card information exploitation in the event of a data breach.

Tokenization Visa enables customers to process payments without exposing sensitive information that could be compromised. Merchants, acquirers, and issuers can provide improved protection against misuse, gain insight into third-party payment experiences, and keep cards on file to provide reliable ways for customers to shop via e-commerce and m-commerce.

For Digital Token Visa to protect customer data from hackers, the token is limited to one device, merchant, channel, or transaction type.

How does Visa Tokenization Service work?

Visa card token technologies for safer e-commerce experiences.

Visa card token technologies for safer e-commerce experiences.

According to Visa analysis, as of April 2021, the company surpassed 2 billion tokens issued through Visa Token Service, and around 615,000 merchants worldwide were transacting via Visa Token ID.

Because of the VTS, digital payment service providers and financial institutions can now offer customers a secure way to shop online and on mobile devices. But what is the entire procedure of a tokenization Visa? Let’s find out together.

  1. By providing their primary account number (PAN), security code 1, and other payment account data, the consumer registers digital payment service with their Visa account (e.g., an online retailer or mobile wallet).

  2. The digital payment service provider asks for a Token ID Visa.

  3. Visa Token Service forwards it to the account issuer (for example, the consumer's bank).

  4. Visa replaces the consumer's PAN with a token once the issuer's account has been approved.

  5. Finally, Visa provides the token to its requester. This payment token can be limited to a specific mobile device, e-commerce merchant, or a certain number of purchases before it expires.

  6. Although issuing Visa tokens may appear to be complicated at first, it only takes users five steps to complete the process and enjoy all its benefits.

How to use Visa Token Service?

Given that consumers prefer to shop using various connected devices, it is imperative to implement a secure digital payment environment everywhere.

The Visa Token Service is now available online, in-store, and through a mobile application (in-app).

Tokenization Visa offers online retailers an innovative and secure method of accepting payments in the digital commerce environment. A token Visa card enables consumers to make secure in-store payments by hovering their device next to the payment terminal. Here’s how to use Digital Token Visa:

  1. The consumer makes a payment (online, in-store, or through an app).

  2. The merchant sends the acquirer a Visa Token ID. The digital payment service provider sends it to the acquirer in an authorization request.

  3. When the acquirer receives the token, it sends it to Visa's network to begin processing the transaction.

  4. The token is sent to the card issuer by Visa Token Service. Visa, in turn, sends the token and payment card information to the issuer for authorization.

  5. The issuer returns the token. The issuer accepts or declines the transaction and notifies Visa of the decision.

  6. The transaction comes to an end. The acquirer (the merchant's bank) receives the token and payment authorization.

Where to process secure digital payments?

"An impressed customer is a retained customer" is a mantra bouncing around industries, and for customers, Visa prepaid digital token is a big yes. You can rest easy knowing that there are a lot of Visa Token Service providers out there, and PayCEC is one of them.

PayCEC offers merchant accounts for accepting credit and debit cards, allowing for a seamless payment acceptance process across devices at any time and location.

Skyrocket your sales with our 3D Secure system, an authenticated payment system designed to improve online transaction security while encouraging the growth of e-commerce payments.

We also employ comprehensive security technology, such as PCI DSS compliance, 3D Secure Visa, to ensure secure payment processing for all merchant transactions. Reduce credit card fraud to keep your business in compliance with us today!

Read more:

About PayCEC

PayCEC was established in response to the growing need of businesses to accept online payments more quickly and easily. In the new media era, our payment gateway has evolved to work seamlessly and effectively across all platforms and devices. We pride ourselves on combining superior technology with first-class customer service.

PayCEC is a truly global payments platform that not only allows customers to get paid but also withdraws funds to their business accounts in various currencies.

We have created an open and secure payments ecosystem that people and businesses choose to securely transact with each other online and on mobile devices.

PayCEC Team

Frequently Asked Questions

According to Visa, the token service targets financial institutions looking to attract and retain customers through crypto services, retailers investigating non-fungible tokens (NFTs), and customers conversant with cryptocurrencies.

Hence, Visa Token management services include providing a deeper level of crypto knowledge, allowing crypto payment systems, and supporting operational management.

The Visa Token Service technology replaces important payment account information on plastic payment cards with electronic account numbers, which can be securely stored on mobile devices and used to pay in stores and apps.

Tokenization refers to replacing the 16-digit primary account number with a unique code, also known as a token, which enables customers to make payments without disclosing credit card information to merchants.

The Visa tokenization service offers a simple and secure way to transact via mobile devices, thanks to advanced technology. Reduced data breaches, cardholder information protection, and secured digital transactions are all benefits of tokenization.

In future transactions, tokens are going to replace card information, ensuring complete security. In the event of a data breach, criminals cannot access the card data because the tokens stored in the system will be valid for a specific combination of users.

Yes, it does. The Visa Token Service substitutes an individual digital identifier that acts as a token for personal account information found on credit cards. While the tokenized card connects to the user's mobile wallet application and smartphone, it will digitally process payments and keep account details secure.

“Tokenization is the lynchpin of Visa’s strategy in a commerce ecosystem that is increasingly influenced by connected devices,” Jordan McKee, senior accessibility analyst at 451 Research said. “Visa will inevitably bring the Visa Token Service to all geographies where it has a presence in hopes of enhancing the security of every digital transaction that involves a Visa card.

“Tokenization brings heightened security and ease of use to consumers, thus removing critical hurdles on the path to adoption of mobile payments.”

According to Visa, when a consumer registers their Visa account with a digital payment service provider (such as an online retailer or mobile wallet), the service provider requests a Visa Token ID. Visa may share the token request with the issuing bank, depending on the use case.

Visa replaces the consumer's PAN with the token after receiving approval from the account issuer. It also shares the code with the payment service provider for online and mobile (NFC) payments. Before expiring, a Visa prepaid digital token is only valid for a specific mobile device, e-commerce merchant, or purchase transactions.

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We are honored to serve as your reliable business partner and financial service provider in the industry and other business-related services. With the help of our professional staff, to help merchants to achieve their goals for the development and expansion of the international business market.

Our payment flow has developed in the e-commerce world to perform seamlessly and effectively across all platforms and devices. We take pleasure in combining technology with customer service, to solve your concerns at the moment.

PayCEC is a fully worldwide payment network that not only allows merchants to be paid immediately and securely, but also allows them to withdraw money in multiple currencies to their company accounts.

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