On Tuesday, Visa announced that it will be rolling out tokenization technology in Europe by mid-April. The new tokenization technology could make Apple Pay roll out a breeze internationally to the 743 million people continent.
The tokenization technology is the “the heart of new mobile payment solutions.” It’s pretty obvious, though. Tokenization is used in Apple Pay, which is used to replace sensitive information with a one-time digital token exchanged between your iPhone and an NFC-enabled payment terminal.
“Apple and Visa (Inc) have an agreement around what has happened,” Visa spokesman Steve Perry told Reuters. “I am as excited as anyone, but we have to wait,” he said. “The tokenization service protects customer data, substituting the payment account information found on a plastic card with a series of numbers that can be used to authorize payment without exposing actual account details,” explained Visa.
“When consumers use their mobile device to make a contactless payment in a store, a token is submitted, rather than their account details.”
Because credit card data nor data transaction is stored on the device, merchants don’t have access to it. Even if someone gets a hold of your transaction data, they would be completely useless because the token used for the transaction can only be used once.