Mastercard announced a major change in how Europeans will pay for online products and services starting in 2030. As reported by CNBC, the company will eliminate the need for manual card number entry, replacing the traditional 16-digit card number with a randomly generated "token."
To make this happen, Mastercard has been collaborating with banks, fintechs, merchants, and other partners to implement this change across Europe. The transition will enable automatic updates for tokenized cards stored on merchant sites or electronic wallets, ensuring seamless and secure transactions.
Mastercard Tokenization in 2030
This move towards tokenization will help strengthen the security of online transactions and reduce fraud. At checkout, consumers will benefit from one-click payments using biometric authentication, such as thumbprints.
Valerie Nowak, Executive Vice President of Product and Innovation at Mastercard Europe, cited tokenization's increasing popularity due to its ease of use and effectiveness in reducing fraud.
Nowak believes that achieving widespread tokenization by 2030 will benefit everyone involved: shoppers will enjoy more secure and convenient transactions, retailers will face less fraud, and card issuers will see improved transaction security and customer satisfaction.
As a whole, Mastercard believes this shift will be as transformative as the adoption of chip and PIN and contactless payments, making online transactions as smooth as in-store contactless payments.
The company's partnership with Mercedes-Benz, which allows customers to use a fingerprint sensor to pay for service stations in Germany, exemplifies this vision.
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