Credit and Debit Card Tokenisation: How Will it Work in India?

Credit and Debit Card Tokenisation: How Will it Work in India?

The Reserve Bank of India is set to bring its card-on-file tokenisation norms into effect from October 1, 2022. Let’s find out how card tokenisation will work and how you can take advantage of the norm. Let’s begin.

What’s Happening?

Since the craze of online shopping began, the demand for credit and debit card payment systems never seemed to subside. You might have also encountered situations where online shopping platforms encourage you to save your card details for faster checkout. 

But did you ever realise that, by doing so, you are taking up a huge risk?


When you save your 16-digit card number and expiry date, the merchant and the payment gateway save the data for future transactions. It is done to make the checkout process hassle-free so that you don’t have to punch in the 16-digit card number every time you make a purchase. 

Yes, it is convenient, but there is a considerable risk involved. 

Your card details are stored by the merchant online or in a cloud system known as the card-on-file (COF) system. Although the payment systems are encrypted, the card details stored by the merchants are at risk.

To avoid unforeseen situations, the RBI is taking precautionary measures of tokenising debit and credit cards. 

Process of Tokenising Your Card

In this process, your card details, such as a 16-digit card number, name, and expiry date, will now be replaced by a token code. These tokens will be unique for a combination of cards, token requestors and devices.  

Who is the token requestor?

Well, the token requestor is the intermediary which accepts a request for tokenisation from your end and passes the request to the card network, which will issue a token against your card. 

Once the token is generated, the tokenised card details will be used in place of the actual card number. This process is efficient, safe and hassle-free. 

Moreover, the tokenisation process is entirely free of charge for customers. 

How Can You Tokenise Your Card?

Tokenising your card is a relatively simple process. 

  • All you need to do is visit your online shopping platform, make a purchase, and initiate the payment by choosing a card. 
  • Select ‘Secure your card as per RBI guidelines’. You will receive an OTP on your bank-registered mobile number and complete your transaction.
  • There you go! Your token has been generated and is stored instead of your original card details. 
  • When you make a purchase next time, the last four digits of your card number will be displayed to identify your card. 

What’s Next?

The Reserve Bank of India is set to bring its card-on-file tokenisation norms into effect from 1st October 2022. After this date, the card details cannot be stored on the e-commerce platforms, nor will they be shared with the merchant during the payment process. This will ensure the safety of the customers and will reduce any sharp practices. 

PayTM has tokenised over 52 million cards across VISA, Mastercard and RuPay, and PhonePe has tokenised over 14 million debit and credit cards.

So, get your card tokenised and enjoy hassle-free and safe transactions!

That’s it for today. We hope you enjoyed reading the newsletter.

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Note: The companies mentioned in the article are for informational purposes.

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