Going digital! Mastercard plans to eliminate "manual card entry" for online payments in Europe by 2030.

Mastercard plans to eliminate the need for European consumers to manually enter their card numbers when making online purchases by 2030.

Introducing Tokenization, but Not the Kind You Might Think

Mastercard is set to replace familiar 16-digit card numbers with randomly generated "tokens". This tokenization process aims to enhance security and simplify the checkout process. Mastercard has been working with banks, fintech companies, merchants, and other partners to enable seamless one-click payment buttons across all online platforms.

This system has been a long-discussed concept. As early as 2016, a Taiwanese financial company explained the basic idea of "tokenized payments," which involves virtualizing card numbers to enhance security during transactions in physical or online stores, where real card numbers are not displayed.

Mastercard claims that this shift to tokenization will significantly enhance the security of consumer cards against fraud. Mastercard has also introduced clearance keys to replace traditional passwords, enabling one-click payments through biometric technologies like fingerprints. Users no longer need to repeatedly enter passwords, streamlining the payment process.

One major advantage of tokenization is that cards stored on merchant pages or digital wallets can be automatically updated when replaced or renewed, ensuring that payment information remains up to date without the need for user intervention.

Tokenization Technology Reduces Fraud Rates

Mastercard believes that achieving 100% tokenization on e-commerce websites will significantly reduce fraud rates. According to Mastercard reports, the adoption rate of tokenization is growing by 50% annually, and approximately 25% of global e-commerce transactions online are currently protected.

Europe to Lead the Way

The rollout of this new system will begin in Europe, a region that has been at the forefront of payment innovation, such as contactless payments and online banking services. Valerie Nowak, Executive Vice President of Product and Innovation at Mastercard Europe, stated: "In Europe, we have seen momentum around tokenization across the ecosystem. The convenience and reduced fraud are compelling in themselves. We are confident in achieving this vision by 2030, which is a win-win-win for consumers, retailers, and issuers."