Giving control of digital payment credentials to consumers


The growth of global e-commerce continues to escalate. According to data from Morgan Stanley, it now makes up over a fifth of all retail sales (22%), up from 15% in 2019.

With the rise of digital e-commerce, more sensitive card details are being stored online

Many consumers that previously stuck to in-store purchases have taken the plunge into online transactions. With this trend, more consumers have their sensitive card details stored with a number of new merchants to ensure simple repeat purchases.

Despite card-on-file approaches being highly convenient, consumers who have now adopted digital payments may have security concerns, experience checkout friction or struggle to keep tabs on which retailers have their payment credentials stored. These concerns should encourage card issuers to provide easy-to-use tools for consumers to be able to manage their digital payment credentials, and in the process, also attain the much-desired top-of-wallet position.

Moving forward with network tokenisation

Critical to reducing card misuse and offering a disruption-free experience during e-checkout is the use of network tokenisation. This is where sensitive data is replaced with a secure token that can be passed between card networks, issuers, and payment service providers, without details ever being exposed.

The tokens devised are truly unique to each device and merchant, with no discernible link between the token and its original number. The result is improved payment authorisation rates due to greater trust in the process and fewer false transaction declines, as well as reduced fraud rates compared to transactions where users’ PANs are sent directly.

There are now billions of tokens in use due to their ability to act as the facilitator of greater security and enhanced simplicity. In fact, a recent study has predicted that the total number of tokenised payment transactions will exceed one trillion globally by 2026, rising from 680 billion in 2022. As well as being used to issue payment credentials, they’re also being incorporated into online retail, IoT applications, and in-app payments.

While highly secure in isolation, traces of digital payment credentials are being left across a significant amount of e-commerce sites due to token proliferation. This is reflected in the fact that the number of tokens per cardholder is growing tenfold from a current average of five tokens to potentially more than 50.

This raises a conundrum. While tokenisation provides value in being able to secure transactions themselves, it’s also pivotal for consumers to be able to monitor these newly tokenised credentials. Indeed, as tokens are on the rise, the perceived challenge may not be the risk of personal information being breached but rather the need for a credential management capability.

Digital payment credentials in one place

The key for card issuers is offering the ability for customers to be able to review and manage all their digital payment credentials from a central hub. This will help to foster transparency and trust, alongside creating a compelling proposition for card issuers. This token management facility could for example be added to an existing mobile banking app, where the consumer can effectively control their payment cards.

Visibility and control at this level can be advantageous to numerous stakeholders across the transaction chain. Customers have authority over storage locations, plus how they interact with the issuer, boosting the issuer’s trust profile and enhancing brand engagement. Issuer-merchant bundled offers are also a possibility, which could be linked to other applications such as personal financial management that may be featured in some issuer wallets. With consumers also empowered to undertake self-service by creating a new token for a service they need or temporarily suspending it for one that is no longer required, the workload is eased for the issuer’s customer care services.

Empowering consumers

With integrated token management tools, card issuers are able to offer monitoring capabilities to customers, giving visibility of digital payment credentials and their tokenisation and storage locations. Consumers achieve control by being able to activate, suspend, and revoke their tokenised cards in their chosen mobile banking application. These tools also allow the ability for mobile wallet providers to be better integrated.

As e-commerce shows no signs of slowing, the need for a seamless experience to be provided to consumers is vital as retail continues to change. Many consumers are now accustomed to instant digital services and will turn away from a multi-step checkout process, placing pressure on organisations to meet their demands. Now, card issuers are able to bring the required visibility and control to digital credential management, in addition to tokenisation of customer card details. The best way to achieve this is via a banking app or other online interface, putting the power in the hands of consumers.


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