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What is payment network tokenization? Improve card processing

Blog post from Basis Theory

Post Details
Company
Date Published
Author
Basis Theory
Word Count
651
Company Posts That Month
8
Language
English
Hacker News Points
-
Post removed?
No
Summary

Payment network tokenization replaces card numbers and other sensitive payment data with unique tokens managed by networks such as Visa or Mastercard, allowing transactions to be processed without exposing the underlying information. It can improve authorization success because tokens may remain valid after a physical card is replaced, while also potentially lowering interchange costs, supporting larger transaction amounts, and reducing the exposure of personally identifiable information and cardholder data. Although payment service providers can simplify tokenization by supplying token vaults, keeping tokens within a PSP’s system can create vendor lock-in and limit the ability to switch processors or use multiple providers. A third-party token service provider with a PCI-DSS Level One-certified vault can instead store and provide network tokens independently, enabling merchants to route payments among multiple PSPs, pursue payment optimization strategies, and retain greater control over sensitive data.

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