From January 1, 2022, RBI's rules for online debit and credit cards will change.

Making payments through the internet has become the new standard. People prefer to make online payments rather than carry cash in their pockets. People undertake online transactions for a variety of reasons, including ordering meals, shopping, and booking taxis, and they preserve their passwords, debit card, and credit card information. However, along with the rise in internet banking, the prevalence of online fraud has skyrocketed. As a result, the Reserve Bank of India (RBI) has instructed all merchants and payment gateways to erase critical customer information from debit and credit cards that is kept on their end in order to make online payments safer and secure.

As of January 1, 2022, the new regulations for debit and credit cards will take effect, and the RBI has also instructed retailers and payment gateways to employ encrypted tokens for transactional data transmission. The same is true for banks, who have begun to tell their consumers. Customers of HDFC Bank have been notified through SMS that their personal information maintained on Merchant Website/App would be destroyed by the merchants from January 1, 2022, in accordance with the RBI regulation for better card security. It also stated that if you want to pay each time, you'll need to provide your entire credit card information or choose tokenization.

From January 2022, when you make your first payment to a merchant, you will be required to provide an extra form of identification to ensure your identity (AFA). To complete the transaction, you will need to enter your card's CVV and OTP.

What is Tokenization?

According to HDFC Bank's FAQs, is the process of substituting a code termed a "Token" for the actual or clear card number. The combination of card, token requestor (i.e. the entity that accepts the request from the consumer for tokenization of a card and sends it on to the card network to issue a matching token), and merchant should be unique (token requestor and merchant may or may not be the same entity). As a result, with tokenization, a customer's 16-character credit or debit card number is replaced with a unique online identity known as a token-which is a random string of 16 digit integers. In a tokenized card transaction, the real card information is never disclosed or retained with the retailers. The HDFC Bank website states that there are no fees for using the service of tokenizing the card in its FAQs on the feature.

How can I obtain a Tokenized Card?

The first step is to request the card token via the bank's website or app using the token requestor.

In the second step, the retailer will contact the bank that issued your credit card or Visa/Mastercard/Diners/Rupay to obtain the token.

At this point, a token is created that is associated with a particular card, as well as with the person making the token request as well as the merchant.

Tokenization cards may be used with Mobile Credit Cards for payments such as NFC-enabled POS transactions and Bharat QR code-based payments, whether online or offline. In addition, any and all feasible businesses, both online and off.

Other key facts to remember about Tokenisation: -

• Tokenization is only applicable for domestic transactions

• For maintaining your tokenized cards, banks will provide a gateway to the cardholders to see and manage the tokenized cards. This site allows cardholders to see and delete tokens associated with their specific cards.

• If a card is issued by a bank or referred to as a "authorised card network," tokenization and de-tokenization may only be conducted by that bank or network.