Explained | What is tokenisation of debit and credit cards?

The story so far: The Reserve Bank of India on December 23 extended the deadline given to online merchants and financial payments companies for the tokenisation of card data used for online transactions. It wanted to put an end to the practice of online merchants storing the card details of customers, which the Central bank believed could lead to misuse of cards by fraudsters. To overcome this problem, the RBI proposed that online merchants use token numbers instead of card data to store customers’ cards on their platforms. Critics of the RBI’s Order believe that online card transactions are already secure enough since customers need to authenticate transactions through CVV, OTP and other means.