Network Tokenisation

What is Network Tokenization?

Network tokenization replaces sensitive card details with a unique, non-sensitive token provisioned and managed by networks. This token is specific to the merchant(Token requestor) and can be used for secure transactions instead of the actual card number.

Benefits of using Network Tokenization:

1. Reduced Security Vulnerability: By using network tokens instead of sensitive card information, you minimize the impact of data breaches, as the network token is specific to a merchant and is of no use to malicious actors. This helps you maintain customer trust and avoid the financial and reputational damage associated with security incidents.

2. Up-to-date Cardholder Information: Tokenization automatically updates cardholder information if the card is lost, expired, or reissued. This ensures uninterrupted recurring payments, increasing customer retention and reducing payment disruptions.

3. Improved Authorization Rates: Transactions using network tokens are considered to be more authentic by the networks as they carry richer data, leading to fewer declines and higher authorization rates.

4. Reduced Fraud: Network tokens are less prone to frauds and have been shown to reduce fraud by up to 26%, which means fewer chargebacks and losses for your business, ultimately improving your bottom line.

5. Simplified Compliance: With tokenization, your business doesn’t need to store sensitive card data, reducing the scope and cost of compliance efforts.

Use Cases with Hyperswitch:

• Subscription and Repeat Based Businesses: Ideal for businesses with recurring payments, tokenization ensures seamless payments by automatically updating card information, improving authorization rates.

• Gateway Agnostic: Hyperswitch’s Network tokenization works across payment gateways, allowing merchants to make recurring MIT(Merchant Initiated transaction) payments with the payment gateway of their choice.

How Network Tokenization Works:

1. Card Information Submission: The customer provides their card details during a transaction.

2. Token Generation: The payment network (e.g., VISA, Mastercard) replaces the card details with a unique token specific to the merchant.

3. Token Use: The merchant uses this token to process payments instead of the actual card number.

4. Transaction Completion: The payment network links the token to the card and completes the transaction securely.

5. Recurring Transactions: For future payments, the same token is used, ensuring up-to-date card details even if the card is lost, reissued, or expired.

6. In this above flow Merchant server is the TR (Token Requester) and Hyperswitch is the TR/TSP (Token Service Provider).

How to Enable Network Tokenisation:

Network Tokenisation is an on-request offering from Hyperswitch.

To enable Network Tokenisation for your merchant account, Kindly reach out to [e-mail]

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