Mastercard is taking a significant step towards enhancing online payment security by planning to eliminate traditional credit card numbers and expand the use of tokenization technology. This move aims to address the escalating issue of online fraud, projected to surpass $91 billion by 2028.
Tokenization involves replacing sensitive data like credit card numbers with randomly generated digital sequences called tokens. These tokens are used during storage and transmission, significantly reducing the risk of data leakage. Mastercard CEO Michael Miebach highlighted the rapid adoption of tokenization, stating that while it initially took three years to process the first billion transactions using this technology, the company now handles a billion such transactions per week.
In addition to tokenization, Mastercard plans to replace traditional passwords with biometric identification methods such as fingerprints or facial scans. This further strengthens security by relying on unique physical characteristics for authentication.
The financial industry is actively seeking innovative solutions to combat the rising tide of online payment fraud. Mastercard’s initiative to phase out credit card numbers and embrace tokenization and biometrics represents a significant step towards safeguarding sensitive consumer data and ensuring secure online transactions.
