The Reserve Bank of India (RBI) has issued new rules for card payments, which will be applicable from January 1, 2022. There will now be a token system for online payment. In transactions through the Card, no other than the card issuing bank or the card network will store the original card data.
Payment aggregators will be able to store limited data for transaction tracking or settlement in the event of a dispute. Will be allowed to store the last 4 digits of the original card number and name of the card issuer. Any other information will not be retained by any payment aggregator.
What is ‘Card Token’ System?
From January 1, 2022, you will not have to share your card details with any third party app. This is not the case now, now if you order food online or book a cab, then you have to give the card details and here the complete details of the customer’s card are saved. Where there is a risk of fraud. This will not happen with the token system.
To understand this in simple language, you do not need to enter your card details in the token, instead there is a unique alternate number called ‘token’, which is linked to your card. Using which your card details remain safe. Meaning when you make payment after shopping on any e-commerce website, such as Amazon or Flipkart, then you will not have to enter your 16 digit card number, instead you will have to enter the token number.
Now you have to enter the complete information of the card
while making online payment, now you just have to enter the CVV number. This means that the e-commerce website already has complete information about your debit or credit card. But now that won’t happen. E-commerce websites cannot store your card information. Instead, the payment will be through a ‘token system’.
The new arrangement will be optional, the
token arrangement will depend on the wishes of the customers. There will be no pressure on the customers to take it. Apart from this, it will not be compulsorily implemented by any bank or card issuing companies.
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