Saturday, 21 September 2019

GPay brings Tokenised - This Is How It Works

Google made an announcement for its Google Pay users can add Credit and Debit cards to their Google Pay app for having a seamless experience while doing any transactions. Google has allowed UPI based payment option from our bank accounts.

According to Google, they will be using tokenization technology for adding credit and debit cards. In which instead of actual credit/debit card nos, the application will use a digital token to authenticate your card.

Tokenization is slightly different from Google Pay. Here are seven simple steps to understand the process.
  1. Adds a credit or debit card to your Google Pay app.
  2. Now Google Pay will request a token to represent the card they’re trying to add from the bank that issued the card.
  3. Once the token is issued, this card is now “tokenized,” meaning it has a unique identification number associated with it.
  4. Google Pay encrypts the newly tokenized card and it is ready to be used for payments. 
  5. When the user tries to pay,  Google Pay responds with the user’s tokenized card and a cryptogram which acts as a one-time-use password.
  6.  The card network validates the cryptogram and matches the token with the user’s actual card number.    
  7. Your acquiring bank and your user’s card issuing bank use existing user information and decrypted user billing information to complete the transaction. (reference)    

They will be rolling out this functionality in the next few weeks as per the keynote. Currently it is supporting Visa cards only from Axis Bank, HDFC Bank, Standard Chartered Bank and State Bank of India. Soon they will be adding support for Mastercard and RuPay cards too.

Security Benefits

With the inclusion of tokenization in Google Pay, users will be able to do faster and easier online purchases as they don’t have to provide their credit/debit card details while doing the transaction. A one-touch checkout experience can be provided to millions of Google users with the use of Google Pay API.

The tokenization process offers security benefits to both customers and merchants.
  • Device lock screens, remote data wiping and tokenized card numbers features will provide protection to customers from loss or theft of devices containing token information.
  • Integration with Google Pay is simple for merchants for using tokenization.
  • The tokenization process will cause merchants to store less sensitive customer information thereby will reduce exposure and worries about data breaches.

Tokenization will strengthen security for card users while doing online transaction. Many cases of cyber frauds reported in which the victim has shared their card details with fake entity and they siphoned huge amounts from their accounts.

In the Google event, they have also announced a new Spots platform for Google Pay. Which allows merchants and companies to create physical QR-Code and NFC-based payments cards for offline payments.  

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