Visa is anticipating a plethora of new payment options emerging with the Internet of Things, and has announced a big push in the promotion of its token service provider (TSP) program to meet the security challenges associated with this trend.
Citing data from a study entitled “How We Will Pay”, based on surveys of 2,600 adult smartphone owners in the US and conducted in collaboration with PYMNTS.com, Visa says that “more than 80 percent of Americans have a strong interest in using connected devices to make purchases,” according to a statement. Seventy-five percent of respondents were found to already be using at least one such connected device – not a smartphone or computer but something like a smart watch, game console, Amazon Echo, and so on – and “83 percent recognize those devices as saving time and reducing friction when making purchases”. Those trends are on the upswing, but at the same time, so are concerns about security, with 75 percent of study participants expressing worry over “data privacy” and 69 percent citing “order verification and accuracy”.
That’s where Visa’s tokenization services come in. They replace cardholder information with unique digital keys (or ‘tokens’) that can then be exchanged for online payments; if intercepted, the encrypted information is designed to be useless to the hacker.
Visa launched its tokenization service last autumn, and recently predicted that it would be in use in 12 European markets by the end of the year. To that end, the company has announced that it now has 13 new partners signed up for TSP, including Digiseq, FOO, Pri-Num, and Seglan in the EMEA market; as well as Mahindra Comviva and Paycraft in India and APAC; HST, Prosa, Veritran, and YellowPepper in the Caribbean and Latin America; and global companies FitPay, Infosys, and Rambus. As the IoT continues to emerge and the payments industry continues to digitize, Visa’s tokenization services are evidently proving appealing.