“Tokenization has succeeded in mitigating fraud elsewhere in mobile payments, and is now ready to do the same for real-time payments, enabling account-based transactions to be processed faster and safer than ever before,” Rambus’ David Worthington explains in a new white paper that is now available to download from the NFC World Knowledge Centre.
“Demand deposit account (DDA) credentials for business or consumer current, savings or checking accounts are stored in a wide range of locations,” Securing Real-time Payments with Payment Account Tokenization explains.
“E-commerce websites, invoices, payroll, mobile wallets all store account numbers in their raw form, making them vulnerable to fraud. Attacks involving account-to-account transactions are therefore increasing.”
“Ramping up the speed of the clearing process makes fraud prevention even more difficult,” the paper adds. “Detecting irregularities over a matter of seconds, rather than days, is a big challenge for banks. This increased risk can be seen in the experience of the UK, where payment fraud more than doubled in the first three years following the arrival of Faster Payments in 2008 and six years later had risen by nearly 270%.”
“Tokenization is one measure gaining significant momentum, as it removes sensitive data from the transaction process.”
The 12-page white paper explains how the tokenization of payment account details can mitigate fraud, sets out five key benefits of payment account tokenization and explains how the technology works, using illustrated examples of creating a token and using a token in a transaction.