Razorpay has announced the launch of a multi-network ‘Razorpay TokenHQ’ card-on-file (COF) tokenization solution. It claims to be a turnkey solution for businesses, allowing their customers to continue to experience the convenience of saved card transactions, now with added security and in compliance with RBI guidelines. TokenHQ will work on all major card networks, including master card, Rupee And Visa.
Earlier this year, the RBI issued a new set of guidelines that bar businesses, payment aggregators and acquiring banks from storing credit/debit/prepaid card information of customers. The new guidelines only allow card networks and card issuers to store customer card information, and allow businesses to use the token to offer a saved card experience during online payments. Card-on-file (COF) tokenization is the process of converting sensitive cardholder data into a string of randomly generated numbers called “tokens”, which have no meaningful value if violated. All stakeholders are required to ensure full compliance with the tokenization framework by 31 December 2021.
In the last one year, India saw a more than 2x increase in the adoption of digital payments, due to which the RBI brought in a new set of rules to protect the interests of consumers. The card tokenization framework ensures that customer card information is only with the customer, the card network and the issuing bank, significantly reducing the risk of card data leaks. However, in the absence of tokens, customers will have to manually enter their card information every time they transact online. This may not be convenient for some customers and there are chances of error in entering the data leading to failure of the transaction.
Tokenization as a technology solution bridges this inconvenience gap and enables customers and businesses to maintain “business as usual” by converting customer card information into a coded “token”. Razorpay TokenHQ is available for all businesses; Merchants using and other payment gateways can also use Razorpay’s solution to tokenize and route payments to the card using their existing payment partnerships.
Using Razorpay TokenHQ, businesses will be able to create, process, delete and modify tokens for online card payments with the consent of customers. Razorpay TokenHQ enables the company’s existing customers (at standard and custom checkout) to support card tokenization at zero cost and effort. Merchants with a customized setup can immediately start integrating Razorpay TokenHQ via our developer friendly API.
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