Fintech major PhonePe on September 8 said over 80 percent of the active monthly users on its platform have already tokenised their cards, and the company is on track to meet the deadline for tokenisation set by the Reserve Bank of India (RBI).
The Walmart-backed Unified Payments Interface (UPI) leader said it has tokenised "1.4 crore debit and credit cards" on its platform so far. “We believe card tokenization is a very progressive move by the RBI, and we are on track to meet the September 30th deadline," said Deep Agrawal, Head of Payments at PhonePe.
The central bank has asked payment aggregators to implement card tokenisation by September 30, 2022. Subsequent to this date, they will not be allowed to store the card credentials of customers in their databases. The 16-digit card numbers must be replaced with a token, which is to be used for transactions.
PhonePe said it had started creating tokens in December 2021 and was the first in the payments ecosystem to provision tokens with all three major card networks - Visa, Mastercard and RuPay.
PhonePe added that it had also started processing token-based transactions as early as April 2022, and currently processes almost all eligible transactions through tokens.
The success rate of transactions processed via tokens on PhonePe has shown an improvement of around two percent in comparison with card based transactions, over the past few weeks, it further noted.
"For customers, their card details are saved only by the issuer banks and card networks, minimizing the risk of data leakage and transaction fraud. For merchants, safer transactions translate to consumer confidence in using cards on online platforms, thereby helping merchants witness growth in overall transactions," Agrawal said.
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