In today’s digital age, credit card transactions have become the norm. As more people rely on digital payments, credit card numbers become valuable targets for fraudsters. Tokenisation is an effective method to protect these numbers and prevent them from falling into the wrong hands. This process involves replacing sensitive data, such as credit card numbers, with a unique identifier called a token. This token is then used in place of the actual card number in all transactions. There are two types of tokenisation: reversible and irreversible.
Reversible tokenisation, also known as dynamic tokenisation, allows the original credit card number to be recovered from the token. A token generator creates a unique, one-time token for each transaction. This token replaces the actual credit card number and undergoes the authorisation process. Once the transaction is complete, the token is removed from the system. When the customer initiates another transaction, a new token is created, and the process repeats. Reversible tokenisation is useful for merchants who may need to refund or rerun transactions if they fail, as the original credit card number is stored in the system.
Irreversible tokenisation, in contrast, permanently replaces the credit card number with a token that cannot be reversed. The credit card number is replaced with a token that is permanently linked to the account and stored in a secure database, accessible only by authorised personnel. When a transaction is initiated, the token is used instead of the credit card number. Irreversible tokenisation is beneficial for merchants who need to maintain PCI compliance or handle large transaction volumes. Since the original credit card number cannot be recovered, it is impossible for fraudsters to access it, making this method highly effective for protecting credit card information.
Choosing between reversible and irreversible tokenisation depends on the merchant’s needs. Reversible tokenisation is ideal for merchants who may need to refund or rerun transactions, while irreversible tokenisation is best for those who need to maintain PCI compliance or manage large transaction volumes. Both methods effectively protect credit card numbers, but they differ in their ability to recover the original credit card number.
In conclusion, tokenisation is a powerful tool for protecting credit card numbers and preventing fraud.
