By 2030, Mastercard plans to eliminate the need for Europeans to manually enter their card numbers during online transactions regardless of the platform or device, CNBC reported. This shift towards tokenization and biometric authentication aims to enhance both security and convenience for users.
Supporting Online Transactions
The payment giant will phase out manual card number entry in favor of a randomly generated "token" to enhance the way users pay for online services. Tokens will replace the familiar 16-digit card number, and the service will be available for all Mastercard cards issued in Europe.
Valerie Nowak, the Executive Vice President of Product and Innovation at Mastercard Europe, told CNBC: "In Europe, we have seen tokenization gaining momentum across the ecosystem. The convenience and reduced rates of fraud sell themselves. We are confident that reaching this vision by 2030 is a win-win-win for shoppers, retailers, and card issuers alike."
The company has collaborated with banks, fintech firms, merchants, and other partners to ensure a smooth transition. This initiative seeks to simplify the checkout process and bolster security against fraud. According to Mastercard, tokenization has been growing rapidly, securing about 25% of all e-commerce transactions globally across its network.
With the introduction of passkeys, Mastercard users will no longer need to remember and enter passwords for each transaction. Biometric authentication, such as thumbprint verification, will enable one-click payments at checkout. This technology will also ensure that card details stored in merchants’ systems or electronic wallets are automatically updated when cards are renewed or replaced.
Europe Leads the Way
Mastercard’s push towards 100% tokenization in e-commerce targets to reduce fraud rates. By adopting tokenization, the payments giant hopes to mitigate these losses and enhance transaction security.
Europe has a history of innovation in payments technology. Europe has been at the forefront of adopting contactless payments and online banking. Mastercard believes that the shift to tokenization will be as significant as the adoption of chip and PIN or contactless payments.
The new token-based payment system promises to make online shopping as smooth as in-store contactless payments. Consumers will be able to use any device, from smartwatches to home assistants and even cars, to make secure payments.
Recently, Mastercard extended its global Biometric Checkout Program to Uruguay. This initiative is in collaboration with Ingenico, Fulcrum Biometrics, Fujitsu Frontech, Scanntech, and Red Express. This project allows shoppers at Red Express to pay using their palms. Shoppers can register their payment information and biometrics at the point of sale.
