Published
Dec 24, 2021
Reading time
2 minutes
Download
Download the article
Print
Text size

E-commerce businesses brace for RBI's new tokenisation implementation

Published
Dec 24, 2021

As the Reserve Bank of India prepares to implement its tokenisation diktat on January 1, 2022, many e-commerce businesses are struggling to make the necessary backend preparations to facilitate the change. 

Tokenisation is intended to improve online shopping security but many businesses are not ready to implement it - Alto Nivel


As per the RBI’s plan to introduce tokenisation, all online service providers will have to delete their customers’ credit and debit card information stored on their platforms. Businesses will then have to replace this data with a ‘token’ which is a surrogate code for the personal information.
 
The diktat is designed to increase online shopping security for customers and make their bank card details more secure, ET Bureau reported. If bank card details are not stored with online retailers, it decreases the potential for hacking. 

Unless the RBI extends its deadline for implementing tokenisation, disruptions to online payments could last up to nine months, an anonymous source told ET Retail. As customers may not understand the new card transaction norms, there is expected to be a decline in card payments online which could lead to an increase in UPI payments for some and a return to cash-on-delivery for others. 
 
A number of banks have already begun to alert their customers of the upcoming changes. “Effective January 1, 2022, card details saved on Merchant Website/App will get deleted by the merchants as per the RBI mandate for enhanced card security,” read a customer email from HDFC Bank. “To pay each time, enter full card details or opt for tokenisation.” 

Copyright © 2024 FashionNetwork.com All rights reserved.