What is Tokenization?
Tokenization refers to the process that converts sensitive data into data
that is not sensitive which is called a token. A database or internal system
can use it without bringing it into scope. This method is used to secure data
that is sensitive and can be accomplished by replacing the original data with
an unrelated value that has the same format and length. The tokens are then
received and used by the internal systems of an organization. A secure token
vault is used to store the original data. It differs from encrypted data in
that tokenized data is rendered undecipherable and cannot be reversed. Since no
mathematical relationship exists between a token and its original number, a
token can’t be restored to its original form.
Purpose of Tokenization
Tokenization is meant to swap sensitive data with a random number that is
in the same format but has no intrinsic value of its own. This is different
from encryption. In encryption a number is changed mathematically but its
original pattern is retained within the new code. This is known as
format-preserving encryption. With the aid of tokenization, sensitive data is
removed from one’s business system. This is done by replacing it with a token
that is undecipherable and by storing the original data in a cloud data vault
that is secure. Unlike encrypted numbers that can be decrypted with the
appropriate key, tokens can’t be reversed as there is no mathematical
relationship between the token and its original number.
In the context of banking, tokenization ensures the protection of the data
of the cardholder. When a payment is processed by using the token that is
stored in one’s system, then the original credit card tokenization system is the only one
that can swap the token with the primary account number that corresponds to it
and forward it to the payment processor for authorization. One’s system doesn’t
record, transmit or store the primary account number. No technology can
guarantee a 100% prevention of data breach but a cloud tokenization platform
that has been built properly, aids in preventing the exposure of sensitive data
in order to not let attackers capture any type of information that can be used
by them for their profit.
The purpose of tokenization is to make it easier and more secure to
accept payments. Moreover, it helps to create smooth payment experiences that
result in enhanced customer satisfaction for businesses.
To digress, the data of e-commerce websites or any other type of website
is stored by web hosting companies on their servers, in order to make these
websites accessible. Web hosting companies not only provide server space to
website owners but also the necessary technologies and services that are needed
to keep a website up and running. These website hosting companies are often
known as the “Best Website
Hosting Company” or as the “Best Windows Hosting
Company” or as the “Top Cloud Hosting
Company” when the quality of service that is provided by these
companies is excellent.
Benefits of Tokenization
Tokenization, which substitutes a string of random numbers that are known
as a token for private data, has many benefits. The first and foremost benefit
is that it reduces the risk of data breaches. Hackers target to access
vulnerable systems’ sensitive and confidential data, such as credit and debit
card details. Tokenization ensures protection against the negative financial
impact that results due to data theft. In this way, it aids in fostering trust
among one’s customers by demonstrating commitment towards keeping the
customers’ sensitive data safe. Moreover, tokenization makes it much easier to
achieve as well as maintain compliance with the regulations of the industry.
Any business that accepts payments through debit and credit cards needs to
comply with the Payment Card Industry Data Security Standard (PCI DSS). PCI DSS
aims at reducing sensitive data’s retention as well as governs its deletion and
storage in a safe way. Tokenization meets this requirement as it never lets any
sensitive information that is related to the cardholder be on one’s system. Another
benefit is that payment innovations are driven by tokenization. With regard to
making payments with devices safer as well as easier, this process addresses
this essential requirement perfectly. As is evident, tokenization offers a
plethora of benefits to e-commerce businesses with regard to data security, which
makes it highly valuable.
Source: https://htswebhosting.wordpress.com/2021/02/01/e-commerce-businesses-need-for-tokenization/
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