Master Card pushes for changes in digital payments in Europe; here are the details and the impact of this move

economictimes.indiatimes.com:

Master Card has announced a major change to its digital payments system in Europe and this is expected to affect millions of customers. The company which is the second largest payment network in the world has announced that all digital payments shall be 100% tokenized by 2030. Master Card introduced this system in 2014 and it now accounts for over 25% of all digital payments around the world. The new system seeks to move towards ensuring digital security of the card holder, ensuring ease of payments and also ensuring easier management of card systems. This has been reported by the Mirror.

What does it entail?

Ever card that is used by the consumer for digital payments has 16-19 unique digits which is its card number. The user has to key in these details in certain types of digital payments such as e-commerce transactions, in app transactions on Apple and in other instances. Tokenization removes the need for this. Tokenized cards or tokens would simply replace this with an alternate card number or a ‘token’ to speed up the transactions. This will now be used for e-commerce payments, in-app purchases and other online payments.

Advantages:

There have been numerous cases of debit and credit card fraud payments that have been reported in the UK. The country lost 2.3 billion pounds in 2023 due to fraudulent payment transactions, according to accounting firm BDO’s latest Fraud Track Report. This tokenized system seeks to secure the money of the depositor.

Further