Data Security in ISO 20222 with Tokenization

 With increasing use of account level credentials being used for facilitating payments it comes with risk of ensuring safety of the remittance information. Compounded by various real time rails and the rise of immediate payments the new payment methods such as wallets, ecommerce, QR code and  other payment methods have increased the chance of fraud . Given lack of delay in the real time rails and that payments are irrevocable, fraud mitigation is taken on a higher priority.

Tokens , which can be thought of as surrogates for the PAN or primary account number have increasingly been thought of  as viable solution to address the risk of not securing rich remittance data. They use the same format numbers as the original transaction so the processing protocols can do their job while the customer experience is not impacted.

The processor receives a transaction from the customer's bank , maps a token value to the transaction and sends it to the issuing  bank for clearance. Alternatively the issuing bank and send both the token and the transaction to the processor who then sends the account information to the acquiring bank for fulfillment.