As a point of sale (POS) solutions providers, you do all you can to provide your clients with ways to keep payment data secure and enable them to optimize customer experiences. Did you know cross-platform payment tokens do both?
What are payment tokens?
Tokenization replaces actual payment card numbers and cardholder data with random alphanumeric characters that represent them in a merchant’s system. This technology is different from encryption, which converts data into a cipher using an algorithm. The strength of encryption can vary depending on the type used [e.g.,Advanced Encryption Standard (AES) or Triple Data Encryption Standard (Triple DES)] and data can be decrypted with a key.
On the other hand, tokenization is inherently strong – tokens can’t be “deciphered.” You need access to a token vault to exchange the data. Without that access, you do not know what the token stands for. In fact, merchants don’t even know — only the payment network has access to the token vault and shares data when necessary with payment processors.
Traditionally, payment tokens were processor-specific. That meant if a merchant wanted to change processors, they’d have to update tokens to use with the new company. Cross-platform payment tokens, however, are portable, enabling merchants to use them regardless of which processors they use.
How payment tokens make processes more secure
In addition to replacing payment data with random characters, using payment tokens can also support secure processes at the point of sale. Merchants who use a payment token service never see payment card data – neither do their employees or people who gain unauthorized access to their POS systems.
Without human-readable payment data handled by employees, passing through the POS, or stored in the system, there is no chance it can be stolen or accidentally revealed. Moreover, because the merchant’s POS system never uses actual payment data, payment tokens reduce PCI scope. Compliance is easier and less time-consuming, while payment data is more secure.
How cross-platform tokens improve consumer experiences
Using payment tokens can also result in better CX. Online, payment tokens enable one-click checkouts so customers don’t have to rekey information – and can complete purchases before there’s time for second thoughts and abandoned shopping carts.
Cross-channel payment tokens can also “remember” customers from one channel to the other, which makes buy online pickup in store (BOPIS) or buy online return in store (BORIS) processes easy and efficient.
Payment tokens also provide merchants the easy way to set up subscriptions or recurring payments. Tokens are key to efficient processes that eliminate paper invoicing, minimize time spent on collections and improve cash flow. Furthermore, many payments companies offer services that keep tokens updated when new cards are issued, saving time and reducing the number of declined transactions.
A Must-Have for 2021
The trend away from card-present payments to digital accelerated in 2020. Now, more than ever before, consumers want to engage with merchants and make payments however it’s most convenient. Cross-platform tokenization offers that convenience, as well as security and operational benefits for merchants, to meet the needs in today’s omnichannel world.