Security & Fraud

Visa Delivers Tokenization For The Long Tail

Visa Expands Tokenization

As commerce continues to get more and more connected, reaching even more devices, one of the biggest challenges at hand is ensuring those payments stay secure. One of the best ways to do this is via tokens. But tokenization isn’t always easy to scale and put in motion. That’s why Visa is expanding access to its Visa Token Service (VTS) to new third-party partners in hopes that secure tokens can proliferate the ecosystem just as quickly and easily as connected devices.

Tokenization is looked upon as one of the key ways to secure the increasing amount of connected commerce taking place across the payments ecosystem today, but it isn’t always so simple to get there.

Not every business has the ability to scale its security to keep up with the rapid pace at which payments is moving.

But Visa announced Monday (Oct. 24) its plan to help drive tokenization throughout the ecosystem by opening up its Visa Token Service (VTS) to third-party partners. The expansion will give access to Visa’s token service provider program to a range of new partners, including technology companies, device manufacturers, issuers, Internet of Things (IoT) companies, wallet providers, merchants and others.

Vish Shastry, manager of merchant solution delivery and commercialization for Visa Digital Solutions, provided Karen Webster with the pre-announcement scoop on how the new token service provider program will help more companies scale, securing digital payments worldwide.

 

Giving Tokens Scale

It’s predicted that there could be as many as 38 billion connected devices around the world within the next four years.

Talk about scale.

But provisioning and distributing the number of secure tokens — unique digital identifiers used to safeguard cardholder information while a payment is taking place — needed to keep all of that data safe also takes a significant amount of scale.

Visa’s token service provider program is aimed at making that distribution faster without compromising any of the security involved.

Through the program, technology companies will be provided with access to Visa’s network of tools and services but through a standards-based approach. This will allow more companies to develop new, secure digital payment services, while also ensuring consistency within the EMVCo token standards.

Shastry said that Visa has seen a need for a program like this from both the token requestor and issuer sides. On the token requestor side, there is a variety of new use cases at play, but they need a way to tap into the VTS with scale.

But sometimes, that company may not have the scale for Visa to get to it right away, which is where Token Requestor TSPs come in. These are certified partners connected to VTS and other networks that facilitate the provisioning and lifecycle management of Visa payment tokens.

On the issuing side, Issuer TSPs are certified partners that provide solutions for financial institutions with provisioning, consumer ID and verification, token lifecycle management and VTS notifications of tokens in participating token requestors payment services.

“Secure digital payments will take a huge leap forward with Visa’s token service provider program, by accelerating tokenization throughout the industry,” Jim McCarthy, executive vice president of innovation and strategic partnerships for Visa, said in a statement. “By expanding tokenization and giving both issuers and token requestors choice, digital payment solutions will continue to grow and give consumers peace of mind when paying on any device.”

 

Certified For Growth

As Shastry pointed out, all organizations looking to become a token service provider through participating in the Visa Ready Tokenization program go through a rigorous vetting process for certification.

Once they are certified, companies will be able to scale tokenization quickly without having to wait for Visa.

But the new programs are not just about speed and scale but also creating consistency around the tokens themselves.

With so many token schemes out there, merchants need a way to reconcile the various tokens out there without feeling like tokenization is just another thing they have to manage.

“It doesn’t preclude those merchants from using their own tokenization schemes, tokenizing our token in a way that makes sense for them for what they want to do inside their own ecosystem,” he explained. “But it also gives them optionality and the ability to scale quickly.”

The hope is that, when the industry does, in fact, reach 40 billion connected devices, that there will be enough tokens proliferating through that ecosystem and providing much more secure commerce for those devices.

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