Payment processing company Visa hit a new milestone with its tokenization technology, as Visa tokens have generated more than $40 billion in incremental ecommerce revenue for businesses globally.
Over the last 10 years, Visa has enhanced its security across the payment ecosystem through tokenization – a technology that replaces sensitive personal data with a cryptographic key that conceals sensitive payment data. Tokenization can be embedded into any device, making digital payments more secure while being virtually useless to scammers.
Currently, 29 percent of all transactions processed by Visa use tokens. Since the technology launched in 2014, Visa has issued more than 10 billion tokens.
Tokenization technology has led to a six-basis point increase in payment approval rates globally. In addition, tokenization can reduce the rate of fraud by up to 60 percent. In the last year alone, it prevented some $650 million in fraud.
“Today’s milestone represents the impact that tokenization has had on the entire payments ecosystem since we introduced the technology 10 years ago,” Jack Forestell, chief product officer at Visa, said. “Tokens have changed the game – securing online payments and paving the way for more innovations – from tapping to pay on a phone to enabling a future where we have more control over our data in the age of AI.”
Visa, which now has issued its 10 billionth token, has seen the adoption of tokens accelerated significantly in the last four years, due in part to the shift to digital during the pandemic. Currently, over 8,000 issuers are enabled for tokenization, with over 200 markets empowered with the technology globally. In the last 12 months, over 1.5 million eCommerce merchants transacted with Visa Tokens every day.
“Over the last 10 years, Visa has invested in scaling its token infrastructure to power safer and more convenient digital commerce for consumers and merchants here in Europe, and in nearly every market across the world,” Mehret Habteab, senior vice president of product and solutions at Visa Europe, said. “As AI begins to create more personalized experiences online, we’re using our token expertise to give people more control over their payments data.”
Looking ahead, Visa officials said Visa data tokens could help merchants and commerce platforms use consumer data in a way that is both transparent and gives consumers control. Powered by AI, Visa data tokens let consumers view, consent to and revoke data sharing access, right from their banking app.