EMV Tokenization for eCommerce
Online commerce continues its unstoppable growth.
However, compared to card-present* payments, card-not-present (CNP) transactions still generate an extremely high number of false declines.
Also, even though online commerce transaction authorization rates have increased these last years, they are still far behind the 98% performed in-store.
Why is it so?
There are two main reasons for the lower authorization rate with card-not-present transactions:
Cards expire, or get lost, or stolen, meaning that card details stored on file become outdated.
Card payments are frequently, and most of the time erroneously, considered fraudulent by issuers, leading to a decline.
Declined transactions represent a direct loss of revenue as the outstanding purchase cannot be completed. This in turn creates a bad user experience, leading to customer attrition. One in two customers may simply go to a competitor to finalise their purchase – resulting in the loss of subsequent revenues.
But stay with us. Here are new standards to improve CNP performance: Network tokens and Click to Pay.
* At the store, the transactions are known as 'Card Present' transactions, as payment is performed using a physical card, a Point of Sale (POS) terminal and a processing network. The transaction is called 'Card-Not-Present' (CNP) for online purchases. The card details must be manually entered in an online interface - often the merchant one - to complete the transaction..."
Enhanced CNP: the EMV Tokenization or Network Tokenization standard
Payment Networks have created a standard to secure and enhance CNP performance called EMV Tokenization or Network Tokenization.
An EMV token – an alias with the same format as a PAN- is mapped to and used instead of the physical card number.
The good news?
• The EMV token never becomes outdated, guaranteeing it can always be used for payments.
• It also provides several layers of security, giving more confidence to the issuer to authorise transactions rather than wrongly turn them down.
• Merchants no longer need to store credit card data, reducing risks and increasing customer trust.
But that’s not all. Nowadays with only one in three consumers having their credit card within reach when they shop online (source ClearSale), payment networks are enabling merchants to offer their customers the most convenient, easy and secure checkout experience without any need to type in payment details.
Click to Pay- pay securely and password free from any device
Launched at the initiative of EMVCo, Click to Pay offers a one-click payment solution that removes the need to manually enter card details or a password.
Click to pay is embedded in the merchant’s workflow. There is no need to store the card information, it is secured for both parties, the merchant and the customer.
Integrated with all major schemes, Visa, Mastercard, American Express and Discover, Click to Pay enables a seamless and secure guest checkout experience.
In addition to helping reduce fraud, Click To Pay increases your authorization rate by up to 5%.
How Thales can help
Network token benefits are clear, but their enablement is not easy.
Direct integration with several network is complex and prioritizing resources allocation a real challenge.
Thales offers a better total cost of ownership compared to multiple direct integrations, along with the shortest time to market.
Our platform is highly available and scalable, live with major PSP and marketplace and we have proven capacity to handle large volumes.
Relying on Thales eCommerce platform, merchants and payment service providers can:
• Ensure end-users payment details are always up to date,
• Eliminate false transaction declines,
• Reduce fraud and risk of data theft,
• Connect registered users and guest checkout with all networks within just a few months.
A single intgration with one platform will
Support Network Tokenization for International and Domestic networks
Reduce the time to market with direct schemes connected to Visa, Mastercard, Amex, Discover and Elo,
Enable new tokenization use cases and data analytics services.
Scale with no limits thanks to a cloud-native platform increasing merchant onboarding capacity and delivering ultra-low latency.
Not only will time-to-market be faster and easier, Thales’ eCommerce Token Platform will also set the ground for fully authenticated token.