RBI's new rules to take effect from October 1: Steps to tokenise credit cards, debit cards for online payments

For online payments made with debit and credit cards, new regulations will take effect on October 1. Reserve Bank of India has announced the tokenization, or rule change, for credit and debit cards. The central bank has been conducting an online campaign and has continued to emphasise the benefits of tokenizing one's debit and credit cards. Debit and credit card tokenization must be completed by September 30.

You might need to allow additional time when making online payments if you don't adhere to the new tokenization guidelines that the Reserve Bank of India has announced. These regulations prohibit domestic retailers from keeping a record of your card details, including the number and CVV, when you make an online purchase. To increase the security and safety of the online payment system, the RBI has announced these tokenization rules.

1. Visit any online store or merchant application to place an order and begin the payment process.

2. Enter your debit or credit card information throughout the checkout process. Alternately, select your preferred bank's debit card or credit card from your earlier selected list and enter the rest of the information.

3. Select the "Secure your card" or "Save card as per RBI rules"



option.

4. Confirm the transaction by entering the OTP that your bank issued to your email or mobile device. 

5. Token will be created and kept in place of your actual card information. The last four digits of your saved card will be shown to assist you in detecting it when making additional payments when you return to the same website or mobile app because it has been tokenized.

Tokenization, as described on the RBI website, "refers to replacement of actual card details with an alternate code called the 'token', which shall be unique for a combination of card, token requestor (i.e., the entity that accepts requests from customers for tokenization of a card and forwards them to the card network to issue a corresponding token), and device (referred to herein as identified device)."

The tokenization system is completely optional and without any strings attached. Nevertheless, it does make payments easier while protecting your data. Only domestic online transactions can use tokenization.

According to the RBI, registering for a tokenization request can only be done with the direct consent of the client using Additional Factor of Authentication (AFA), not by using a check box, radio button, or other automatic or forced option. Additionally, the consumer will have the option of choosing the use case and creating limits.