Using Credit Card Tokenization

As the necessity for reliable and powerful security increases and the standards and requirements set out by the Payment Card Industry evolve to meet that need, the necessity for cutting edge solutions will also increase. As criminals develop new ways to attack a system, new ways to guard sensitive information also need to be developed.

Credit card tokenization is a creative solution based on the idea that people can't steel it if you don't actually have it.

Conventional security is proving itself to be insufficient in this digital age. This is becoming more and more evident as we hear more news about companies that have suffered a breach of some kind. Often these companies were under the impression that simple encryption is enough to protect sensitive credit card data on their own sites.

Unfortunately, it has recently become evident that this is not true. Too often the data security measures are mishandled or inefficiently managed, and criminals can get a hold of the encryption keys or find other loopholes and cause serious damage and trouble.

Credit card tokenization was a response to the need for reliable security. The PCI DSS (Payment Card Industry Data Security Standard) mandates that any company that processes, stores, or transmits credit card information must implement a certain level of security in order to be PCI compliant. If a company fails to reach compliance then they are subject to fines, penalties, and possibly the loss of the ability to accept credit cards.

Credit card tokenization is rapidly becoming one of the best ways to implement proper security and reach PCI compliance.

So what's so appealing about credit card tokenization, and how can it help your payment processing and security?

Simple. As previously stated, a criminal can't steal what you don't have. Credit card tokenization lets you process payments without having to store any sensitive data on your own system.

Of course, some of that data is necessary for conducting transactions, especially repeat transactions. Credit card tokenization allows this to occur quickly and effectively, while maintaining complete security.

The process works in this manner: a credit card or debit card (or any other alternative payment method) is used in a transaction (either over the Internet or other electronic transmission), and the initial information is sent to the company providing the tokenization services. Immediately after, a random and unique number is generated and returned to the merchant. This number, or token, is the only thing that needs to be stored on an internal system.

Now let's say that a criminal hacks your system while on the prowl for usable personal data. You've taken all the precautions that the PCI DSS requires, but somehow a particularly resourceful hacker managed to get by all those deterrents. What are they going to find?

If you've employed a credit card tokenization system the only thing they'll find is a collection of 16 digit numbers that don't have any meaning at all. Consider your data protected.

On the other hand, if you store sensitive information on your own system, you are the one responsible for effectively managing and constantly monitoring that information. Are you absolutely certain you'd be able to detect any and all suspicious activity? Are you absolutely certain that you'd be able to prevent all thefts?

Credit card tokenization was designed to help you eliminate those worries. Stop storing sensitive information on your own system and move it to a system that is constantly and effectively monitored, secured, and updated.

Andy Eliason is a writer at Main10, Inc. If you'd like to learn more about credit card tokenization or PCI compliance, visit Braintree Payment Solutions today.