MUMBAI: The Reserve Bank of India (RBI) has extended the scope of tokenisation of card payments, hitherto limited to mobile phones, to all consumer devices — laptops, desktops, wearables like wristwatches & bands, and all Internet of Things (IoT) devices.
Until now, RBI’s approval for tokenisation was limited to mobile phones and tablets. More devices would mean that customers can make contactless payments using their watches or do one-click payments from registered devices.
RBI’s push for tokenisation comes at a time when it is cracking down on the storage of payment information by third parties. Allowing tokenisation on computers will enable users to make one-click payments after registration. It will also do away with the need to send card data over networks.
“This is a great move by the RBI and will definitely help reduce frauds across e-commerce transactions and improve security standards for the industry as a whole,” said Pine Labs CEO Amrish Rau.
Tokenisation is a solution where, once an account is registered with a payment network, the network issues a token, which is associated with a card, to that account. Each time payment has to be made, the account shares the token with the payment network, which processes the transaction on the card linked to the token. Samsung has been one of the early users of tokenisation with its Samsung Pay.
