Shared and Limited-Use Tokens and Other Changes: Tokenization 2.0 Explained

NFC TIMES Exclusive Insight – The second version of EMVCo’s payment tokenization technical framework adds two new token use cases aimed primarily for e-commerce and in-app payments, along with a few new assurance and authentication features, but much of the focus of the version 2.0 has been on restructuring and clarifying issues from the first version of the tokenization framework released more than three years ago, according to EMVCo in a webinar.

EMVCo, the joint venture of six global networks, including Visa, Mastercard, China UnionPay and American Express, also fully incorporated the Payment Account Reference, or PAR, into the version 2.0 release. The group actually introduced the PAR early last year in a bulletin, in response to criticism that payment tokens created problems for merchants, some of which use primary card account numbers to track customers for returns and loyalty. The fix with PAR is still drawing some criticism within the payments ecosystem.  

Overall, payment tokenization figures to play a key role in the rollout of digital payments services, from mobile wallets on smartphones to payments from wearables and other Internet of Things devices. Payment tokenization as developed by the major networks and EMVCo first hit the market with the launch of Apple Pay in October of 2014. E-commerce is seen as an increasingly important use for tokens.

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