MUMBAI: After industry stakeholders raised concerns about the regulations, the Reserve Bank of India (RBI) deferred for a second time by three months--until September--the implementation of card tokenization for online transactions.
Tokenization is the process of replacing actual card details with an alternative, safer code known as a "token." The entity that grants a customer's request for tokenization of his or her card is known as the token requestor.
"The industry's key players have called attention to a few issues with the framework's implementation with regard to guest checkout transactions. Additionally, among all types of merchants, the volume of transactions conducted using tokens has not yet taken off. The Reserve Bank today announced a three-month extension of the original deadline of June 30 to September 30, the RBI said. These challenges are being addressed in conjunction with the stakeholders to minimise disruption and inconvenience to cardholders.
The industry should take advantage of this time prepare all stakeholders about the creation of tokens and how to use them in transactions, implement a backup system to handle all post-transaction activities related to guest checkout transactions, and get all stakeholders ready to handle tokenized transactions, according to RBI.
Besides, It also urged card holders to tokenize their cards for their own safety.