The Blueprint To Building Secure Payments

Tokenisation

There has been a great deal of focus and excitement around mobile payments, digital wallets, social media payments and biometrics and how they will revolutionise how we pay. While the future is very exciting, it is important to remember how anything is only as strong as the foundations it’s built on. In the case of payments, this is tokenisation.

Tokenisation is a highly effective way of mitigating security risks by substituting payment data with an alphanumeric code or ‘token’ when payment is processed. Essentially, all your card data and personal information is boiled down into a sequence of numbers.

This means that providing retailers have chosen a payment solution that tokenises their customers’ card data, should they be the subject of an attack, the data the fraudsters would have access to would be useless to them. If personal card data is not secured in this manner, brands can face the indignity of public backlash and high fines, like Target when it lost 40 million customers’ card details.

This is the beauty of tokenisation. No matter how you pay, whether by mobile payments, digital wallets, social media payments or biometrics, card and personal data is safe – as if you were paying by card. While these innovations offer both consumer and retailer alike a new world of convenience, the reality is that security is still a prime consideration for consumers.

Thankfully, many experts are commenting that mobile payments are actually even more secure than card payments. This is being reflected in a shift in consumer attitudes while recent research from MasterCard shows that greater emphasis is being placed on the opportunities for an enhanced digital experience through mobile payments rather than security.

While 2015 won’t be the year in which mobile payments and digital wallets go mainstream, as I discussed in detail with Retail Focus earlier this year, tokenisation provides retailers with a way to breach the consumer confidence gap in a proven and secure foundation no matter what the payment medium, be it mobile, social or biometric payments where the world of retail will both figuratively and literally be at our fingertips.

Tokenisation has an additional benefit for retailers too: it allows them to collect data on how and when customers are shopping and in turn use that to inform and shape their loyalty programmes. The technology for a new world of payments is now in place – now all we need is to convince consumers that the methods are safe. That starts with security. Regardless of the innovation around the medium through which we make a payment – our phones, our Twitter accounts, even our fingerprints – tokenisation is the common theme, much more than just another brick in the wall.

Mark Prior-Egerton, Solutions Marketing Manager at The Logic Group, is focused on the point of interaction and the growth and adoption of new payment solutions, including mobile. With a background in financial services, Mark is a highly experienced product development and solutions marketing professional. MSc qualified, Mark has over 12 years’ experience in developing and launching innovative new products within the UK retail and financial services market. Highly motivated and passionate about driving businesses forward with a successful track record in leading change and improving bottom line, Mark’s passion lies in developing new payments and loyalty solutions that consumers want.