The initiative is aimed at tackling the interoperability and technology challenges of using digital account tokens to replace card numbers for online and mobile purchasing.
The Feds Mobile Payments Industry Workgroup (MPIW) mentions that developments in tokenization should instill confidence in a payments environment challenged by frequent data breaches and other payments fraud activity. However, it cautions that some hurdles to broad industry adoption of tokenization remain, particularly around standards and coordination of the different approaches taken by industry stakeholders.
In the US, bodies such as EMVCo, The Clearing House and card networks, are focusing their efforts exclusively on payments, while others such as the Payment Card Industry Security Standards Council and the Accredited Standards Committee X9-are designing protocols to protect stored card data or data at rest.
The tokenization workgroup will assess issues related to the use of static versus dynamic tokens, how to prevent creation of fraudulent tokens, use of token risk assurance levels, as well as impacts to infrastructure, interoperability and consumer usability.
The group will also conduct a multi-stakeholder assessment that will include mobile payments industry perspectives on the challenges and opportunities surrounding payment tokenization initiatives.
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