Digital financial services firm One97 Communication Limited, which owns the Paytm brand, has tokenised 28 million cards across Visa, Mastercard and RuPay, and expects to purge saved card data by June 30, the company said on Thursday. The tokenised cards account for 80 percent of monthly active cards on the Paytm app, it added.

“Paytm is committed to safe and secure online payments, and in that direction, RBI’s tokenisation effort is a key milestone for the industry. We recognised the need for tokenised cards and implemented the same on the Paytm app,” its founder and CEO Vijay Shekhar Sharma said in the statement.

Tokenisation, which aims at improving the safety and security of the payment system, refers to the replacement of actual card details with a unique alternate code called the ‘token’, which will be unique for a combination of card, token requestor and identified device.

Instead of using actual card details, this token is used to perform card transactions in contactless mode at point of sale (POS) terminals and quick response(QR) code payments.

The RBI has permitted to offer tokenised card transaction services to all channels, such as near field communication (NFC), magnetic secure transmission (MST) based contactless transactions, in-app payments, QR code-based payments or token storage mechanisms, including cloud, secure element and trusted execution environment.

At present, tokenised card transaction facilities would be offered through mobile phones or tablets only and will be extended to other devices later based on experience.

The RBI has said before providing card tokenisation services, authorised card payment networks shall put in place a mechanism for periodic system audits, at least annually, of all entities involved in providing card tokenisation services to customers.

The central bank also asked card issuers to ensure easy access to customers for reporting a loss of ‘identified device’ or any other such event, which may expose tokens to unauthorised usage.

The RBI has set a deadline of June 30 for companies to complete tokenisation.

“The company has tokenised 28 million cards across Visa, Mastercard and RuPay in its effort to make online card transactions safe and secure for consumers. With this rapid pace, Paytm will be able to purge saved card data ahead of the RBI deadline,” Paytm said.


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