In regards of the card tokenisation deadline put in place by the regulator bank Reserve Bank of India for December 31, 2021, the regulator has now revised the deadline, extending it by 6 months to June 30, 2022.
In a circular released on Dec 23, the central bank has extended the timeline for storing of CoF data by 6 months and states that any data for after the deadline shall be purged.
Card Tokenisation New Deadline Instituted
According to a circular released by RBI on Dec 23, the deadline for card tokenisation has been pushed from Dec 31, 2021 to June 30, 2022, after a slew of requests received by the central bank.
The banking management representative body Indian Banks Association had asked RBI earlier to extend the tokenisation deadline, while some banks also went ahead with making similar requests to the central bank.
In addition to extending the card tokenisation deadline, RBI also noted industry stakeholders could also frame alternate mechanisms to ‘handle any use case (including recurring e-mandates, EMI option, etc.) or post-transaction activity (including chargeback handling, dispute resolution, reward / loyalty programme, etc.)’, which at present requires storing card data to CoF by entities besides card issuers and card networks.
The process of tokenizing will replace the section of card details on credit and debit cards, with an alternate code called a token, which will be unique for each card, token requestor and device.
The transaction conducted using this process is considered to be safer compared to the card details method, as this way no details are shared with the merchant during the process of transaction.
The cardholder can get the card tokenised by initiating a request on the app provided by the token requestor.
Once implemented, none of the e-commerce companies like Flipkart, Amazon, and Zomato, among others would be able to save customers’ card details on their websites.
However, customers will continue to have the option of choice for their payment method through card details.“The RBI wants banks to ensure the banking system is prepared for the new rules. The regulator is in touch with most banks on this subject,” said a senior official at a private sector bank, on condition of anonymity, cited a Moneycontrol report.