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September 10, 2014

Visa launches secure online “token” payments system

Announcement neatly coincides with Apple Pay launch.

By Vinod

Visa has announced its aim to make mobile payments more secure than ever before thanks to a new digital token platform.

Visa Token Service will replace sensitive payment account information found on plastic cards with a digital account number or "token".

Because "tokens" do not carry a consumer’s payment account details, such as the 16-digit account number, they can be safely stored by online merchants or on mobile devices to facilitate ecommerce and mobile payments.

Tokens can be limited to specific merchants, mobile devices or types of purchases, with all major mobile platforms supported. If a device is lost or stolen, tokens linked to it can be instantly reissued without changing account numbers or reissuing plastic cards, Visa says.

Visa Token Service will be available to users of several US banks and financial institutions from next month, with a phased overseas roll out starting in other areas from next year.

"When you make the payment environment safer, you open up a world of possibilities where commerce can take place in different forms and consumers can shop anywhere, on any device, with confidence," said Charlie Scharf, Visa chief executive officer.

"Visa Token Service is yet another example of where we have opened up our network to create meaningful solutions in the form of new standards, tools and services that can enable digital payment experiences that are both engaging and secure."

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The new system will also work with Apple’s newly-announced Apple Pay system, Visa confirmed, following the news that the company had been signed up as an official supporter of the digital wallet.

"Apple’s entry to the market represents a critical piece of the mobile payments jigsaw. This is a pivotal moment for digital payments and one that demonstrates the momentum behind mobile and contactless services," said Steve Perry, chief digital officer at Visa Europe.

The news is the latest activity from Visa as it looks to make all forms of payment more secure. Earlier this year, the company announced it would be teaming up with Mastercard, as well as financial organisations and industry trade groups, to form a cross-industry group looking to enhance payment system security in the wake of several high-profile data breaches.

 

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