Safeguarding the online transactions

It’s a fact that the fraud landscape is progressing, surprising the payment players with constant creativity. It focuses on using the stolen identities of consumers next to empty their wallets. The data in the latest Paypers fraud prevention eCommerce report 2022-2023 shows that:  “…. payment fraud cost eCommerce merchants 3.6% of their total revenues in 2022, proving fraudsters are not only here to stay – but they continuously improve their techniques and technology to create new ways and perfect the old scamming card networks. Between 2021 and 2025, merchants stand to lose up to USD 206 billion on fraud, ….”

How to safeguard consumers in times like this and choose the right fraud prevention strategies? 

The above numbers prove an urgent need for steps to keep what is ours, keep the brands and businesses alive, and protect the ownership of the customers. 

Understanding the customers is of utmost necessity! Improving all aspects of the customer journey is the only way to success. Consumers (online shoppers) expect a seamless, fast, and easy payment experience similar to the one they have in-store, but also, expect that their card data is safe and secure from theft. 

Despite the start of the proprietary or so-called merchant tokenization in the payment industry, with a primary goal to protect the consumer data, stored as Card-on-File, with the merchant or the PSP, recently, the focus has gone to the below-explained network tokenization and the multiple advantages it brings. It answers the customers’ demands and expectations for security and convenience.

What is network tokenization? 

At its core, it’s a process of protecting sensitive cardholder information. It does it on its own or combines with other progressive fintech solutions. It is about replacing sensitive data with a non-sensitive data element that has no value and is called a representative token. While the sensitive information is kept in a secure vault, the token is used to safely transfer the information from one place to another. Even if the token is bridged or compromised during the transfer, no harm can be done since it doesn’t carry any critical value. 

The token that replaces the PAN, is generated and stored by the card networks like Visa, Mastercard, and American Express. It is a unique combination of the PAN with the merchant. One funding PAN can have multiple tokens assigned with different merchants, where each transaction is secured with a unique cryptogram. During the transaction process, tokenized card data is shared between the merchant/PSP and the card networks closing the potential gaps from any risks of sensitive data breach throughout the whole payment process (the detokenization is done within the card networks only for the purpose of authorization of the transaction by the issuer). 

The credentials behind the token are known to the issuer, having the right to decide on transaction success. This enables better risk assessment i.e. more assurance on the transactions, and leads to much better approval rates

The network tokenization

  • replaces PAN with a token to reduce the risk
  • uses a cryptogram to improve security per transaction
  • keeps credentials up to date, to avoid abandonment and to provide a more seamless UX

Having said that, tokenization protects what would otherwise be more easily exposed to fraudsters. So, it reduces the risk of fraud, and the cardholder can feel safe that the data cannot be compromised. Only by securing the most important element of this process, tokenization supports the different angles of the online payment process: providing the needed security, decreasing cart abandonments, and helping merchants to get rid of lost sales opportunities.

It is a technology that benefits the different types of payment players during online payments, by lowering abandonment rates, supporting higher transaction value, and higher conversion rates; it increases revenue and enhances risk mitigation.

How to avoid costly and time-consuming integration and certification processes?

The best solution is to go through one interface that connects to multiple card networks. The eCOM Tokenizer (Netcetera tokenization solution) – is exactly that one interface that can connect to multiple card networks.

It enables merchants or PSPs to connect to all major card networks’ token service providers via a single API, without having to go through costly and time-consuming integration and certification processes with each card network separately.


Card networks prove that, in practice, network tokenization has clearly shown that the rates of approved transactions increase by up to six percent compared to conventional processing.

During the card enrollment, the eCOM Tokenizer obtains a network token from the Token Service Provider (TSP).

Through the checkout, each transaction is strengthened with an additional element, the cryptogram, which contributes to higher security.

The lifecycle management tool ensures seamless and secure eCommerce, where the network token is decoupled from the funding card for notification renewals, and the card data updates happen without any involvement of the cardholder.

As an additional step towards ensuring a seamless customer experience is combining the eCOM Tokenizer with simplified payment solutions like:

The joint solution from G+D and Netcetera, which is available worldwide, will help merchants and PSPs to enhance their conversion in e-commerce transactions.

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