Securing Real-time Payments with Tokenization
Real-time payments (RTP) – where account-to-account transactions can be made in a matter of seconds – are gaining traction worldwide but are also seeing increasing levels of fraud. Payment Account Tokenization leverages a proven process used to secure account-based payments to replace the valuable account credentials with a non-sensitive, restricted use token. This process can significantly reduce the risk and impact of account-based fraud to support the development of a safe and secure instant payments framework.
Direct debit (ACH) account payments contribute to a large majority of the total non-cash payments value worldwide. The credentials associated with these accounts are stored in many different locations (including invoices, payrolls, ecommerce sites, mobile wallets and apps), making them potentially vulnerable for hacking. As more countries move to faster (or instant) account-to-account payments, the timeframe for detecting fraud is drastically decreasing, virtually illuminating the ability for financial institution to implement manual checks on the validity of payments.
When implemented by a centralized body, like a central bank or consortium, Payment Account Tokenization enables central operators to provide a tokenization and detokenization service available to all member institutions. In doing so, it reduces fraud while supporting a seamless integration for multiple use cases including push transactions between businesses, consumers and government.
Example: Using a token for a transaction
Payment Account Tokenization enables central operators to provide a tokenization and detokenization service available to all member institutions