Card Payment Method: From January 1, 2022, the method of payment by card is going to change. The Reserve Bank of India has issued the rules for tokenization related to data storage, which will come into effect from January 1. In this, a special provision has been made on the privacy of the card holder’s data.
What is a card payment system now?
That is, from January 1, the customer will not need to share his card details with any third-party app. Think of it like this that you will not have to share card information with any food delivery app Zomato cab aggregator Ola or Uber. Till now it happens that the complete details of the customer’s card are saved on these apps, due to which there is also a risk of any kind of fraud with the customer. But the tokenization system will not pose such a threat. Although whether to take this service or not, depends on the desire of the customers. There will not be any pressure on the customers to take this nor will it be compulsorily enforced by the banks/card issuing companies.
What are card tokenization rules?
Under the new rules of RBI, from January 1, 2022, no physical card data storage other than the card-issuing bank or the card network will be done in card transactions/payments. In this, any such data already stored will be filtered. However, for transaction tracking or reconciliation purposes, entities may store limited data. Store usage up to the last four digits of the original card number and the name of the card issuer will be allowed.
Rules also applicable on payment from laptop, smartwatch
The card network will be responsible for following the rules. The rule will also be applicable on payments made through CoFT mobile, laptop, desktop, smartwatch, etc. Tokenization facility will be offered only for cards issued by the token service provider. The ability to tokenize and de-tokenize card data will be with the same token service provider. Tokenization of card data will be done with the consent of the customer.