Visa Europe to Push Tokenization in Mobile Payments
Visa Europe will introduce tokenization part of a new mobile payment service it plans to launch in April.
Tokenization has become more popular as a data protection method, thanks partly to its adoption by Apple Pay. It protects sensitive information like account data by substituting it with a secure "token" and rearranges that substitute data randomly to protect it. Tokens are unique to the device that generates them, which should make the data harder to hack.
Visa Inc., which is separate from Visa Europe, is also promoting tokenization and is using Apple Pay as a way to entice Visa issuers to improve their security. As of last month, 43 Visa-issuing banks enrolled in Visa's tokenization service and Apple Pay, representing 75% of Visa's aggregate U.S. payment volume, Visa Inc. CEO Charlie Scharf said during a Jan. 29 conference call to discuss fourth-quarter earnings.
"Tokenization is one of the most important technologies to emerge in digital payments and has the potential to start a whole new chapter in the kinds of products that are developed," Sandra Alezetta, executive director of core products for Visa Europe, said in a Feb. 24 press release. "For that reason, we've designed this flexible and scalable service, enabling issuers, merchants and acquirers to provide consumers with the next generation of innovative payment methods all with the high level of security they expect."