PALO ALTO, Calif.—During the White House Cybersecurity Summit here Visa CEO Charlie Scharf announced a major new initiative around “tokenization” of credit card numbers for online transactions.
Similarly, MasterCard has also announced a new $20-million investment in cybersecurity technology.
In Visa’s case, the tokenization of numbers is part of an upgrade to its Visa Checkout solution. Tokenization replaces the real 16-digit payment card number used to complete transactions with a substitute number, or “token.” If tokenized data is stolen, transaction analytics can detect subsequent use and prevent a fraudulent payment and the tokenized number cannot be used at any other retailer.
According to Visa, its objective is to replace all card data stored by e-commerce companies with the tokens and then to bind those tokens to a particular merchant.
Visa’s larger goal is to replace the card data stored by e-commerce retailers with tokens and bind those tokens to a particular merchant. For consumers, the added plus is that the new security steps don’t require any more work or data input.
Numerous financial institutions have also been testing tokenization technology on the payment apps that are included on mobile phones.
Other security methods are also being rolled out. USAA lets its members take selfies and use their photos as a way to log into accounts (users must blink while logging on to ensure someone isn’t attempting fraud by holding up an account holder’s picture). And Digital Insight has said it will roll out a new biometrics security feature that reads a user’s “eye print” to verify identify.