Mastercard rolls out tokenisation technology in the GCC to protect online shoppers

The Covid-19 pandemic has revolutionised the way we shop. With lockdowns and the continuing need for physical distancing, consumers in the UAE – and across the world – are increasingly moving away from cash and opting for contact-free and digital payments experiences. And the trend is here to stay.

According to the Spending Pulse report by Mastercard, 54 per cent of UAE consumers polled between April and July said that they believe less in-store shopping will continue to be a trend due to the convenience and ease that e-commerce provides. The UAE’s e-commerce industry is set to reach $63.8bn by 2023, a recent report by Dubai Future Foundation states.

The boom in e-commerce has also led to the need for consumers to transact with more ease and flexibility, while ensuring that the information remains secure. In line with this, Mastercard has introduced its ‘MDES for Merchants’ (M4M) offering in the UAE. The new service uses tokenisation technology to speed up and simplify the purchase process online and in app, as well as for subscription-based and recurring payments like streaming music and video services, and utility bills.

Tokenisation encrypts consumer data by replacing card numbers with digital tokens. Every time a transaction is made online or with a mobile wallet, a unique token is created to make the payment which ensures that a consumer’s 16-digit card number is not stored anywhere. This prevents improper usage at any other location and provides additional security to minimise online fraud.

Mastercard’s tokenisation technology also ensures that the cards consumers store on file stay up to date. Unlike physical cards, network tokens do not expire – when consumers receive a new physical card from their bank, their credentials are automatically updated, eliminating the hassle of re-entering their card numbers. The new technology is also designed to protect security of consumers and merchants.

“Online shopping has gained significant traction in the UAE, and it is imperative for merchants of all sizes to ensure that they are offering a convenient, enjoyable and secure digital experience,” says Girish Nanda, country manager, UAE and Oman at Mastercard. “We are protecting the interests of businesses and consumers alike and building technologies that ensure all digital transactions are trusted, secure and frictionless by enabling technologies like tokenisation and leveraging our payment gateway capabilities with MPGS to bring them into market.”

According to Kartik Taneja, EVP – head of Payments at Mashreq Bank, tokenisation not only enhances the security of card holder data, but also enables a “seamless checkout experience” for customers. “We are confident that these solutions will help in enhancing customer trust as well as increase the adoption of digital commerce in the region.”

Currently, Mastercard has partnered with Checkout.com and FOO in the UAE to roll out this technology.

“Checkout.com has been working with Mastercard to introduce innovative features and products that enable our merchants to seamlessly accept payments and unlock more value from every transaction,” says Sebastian Reis, EVP Global e-commerce at Checkout.com. “We’ve seen an acceleration in the shift from offline to online commerce in the UAE driven by the pandemic. As such, the ecosystem requires constant innovation such as tokenisation, to ensure that consumers and merchants are protected in an increasingly digital world.”

Nanda adds that Mastercard remains committed to use its technology to develop innovative digital solutions that are relevant to all users in a transforming digital landscape. “With rising cybersecurity risks amidst this pandemic, our focus remains steadfast on delivering the safe and secure digital experience that all transactional participants need to successfully and safely adapt in a new commercial environment.”