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Razorpay Launches ‘TokenHQ’

Card-On-File (COF) tokenisation is the process of turning sensitive cardholder data into a string of randomly generated numbers called a "token”, which has no meaningful value if breached.

In a bid to further enhance the safety of online transactions, the RBI has issued a new set of guidelines that disallow businesses, payment aggregators, and acquiring banks, from storing customers’ credit/debit/prepaid card information. The new guidelines allow only card networks & card issuers to store customer card information, and sanctions businesses to use tokens for offering saved card experience during online payments. Card-On-File (COF) tokenisation is the process of turning sensitive cardholder data into a string of randomly generated numbers called a "token”, which has no meaningful value if breached. All stakeholders are required to ensure full compliance with the tokenisation framework by 31st December 2021.

To help millions of Indian businesses comply with the new RBI guidelines, Razorpay has announced the launch of ‘Razorpay TokenHQ’, a robust & secure multi-network Card-on-File (CoF) Tokenisation solution. This will be a turnkey solution for businesses, allowing their end-customers to continue experiencing the convenience of saved card transactions, now with added security and in compliance with RBI guidelines. TokenHQ will work across all major card networks including Mastercard, RuPay and Visa. Almost the entire base of 5 Mn businesses using Razorpay’s services will be ready to support tokenised card transactions.

In the past year, India witnessed a growth of over 2x in the adoption of digital payments, leading to the RBI bringing in a fresh set of regulations that safeguards consumer interests. The card tokenisation framework ensures that a customer’s card information rests only with the customer, the card network, and the issuing bank, which minimises the risk of card data leaks significantly. However, in the absence of tokenisation, customers will have to enter their card information manually, every time they transact online. This leads to friction for the customers and increases the chances of error in entering data leading to transaction failures. Owing to the hindrance in saving cards, businesses can expect their conversions to drop by 30%. E-commerce, Education, Financial Services, and D2C brands will also see a significant drop in revenues due to the inability to offer personalised offers and experiences based on customer card details.

Tokenisation, as a technology solution bridges this inconvenience gap and enables customers and businesses to sustain “business as usual”, by converting customer card information into a coded “token”. Razorpay TokenHQ is available for all businesses; and merchants using other payment gateways can also use Razorpay’s solution to tokenise cards and route payments using their existing payment partnerships.

Shashank Kumar, CTO and Co-founder, Razorpay, said, “The RBI has been making great strides to enhance the security and convenience of digital payments in India. Newer regulations offer tremendous opportunities for us to innovate and develop localised solutions that work well for Indian businesses. Tokenisation is one such regulatory development, and Razorpay TokenHQ is a homegrown solution that will enable businesses to continue to offer seamless payments while ensuring individuals have control over their card data. India’s First Multi-Network tokenisation solution, ‘TokenHQ’, will work across all major card networks, thus enabling every business in India to tokenise customer card information.”

He further added, “There are over 950 million debit & credit cards in India and this number will only grow given the rise of non-cash transactions in India’s hinterlands. We hope to see a lot of developments in building smart, secure fintech solutions for businesses and their end-users in the times ahead.”

Using Razorpay TokenHQ, businesses would be able to create, process, delete and modify tokens for online card payments with customers’ consent. Razorpay TokenHQ enables the company’s existing customers (on standard and custom checkouts) to support card tokenisation at zero cost and effort. Merchants with customized setups can start integrating Razorpay TokenHQ immediately via our developer friendly APIs.

Over the past few months, the RBI has introduced fresh guidelines, tightening the noose on digital payments security in India and Razorpay has been working towards introducing solutions that help banks and businesses comply with the new regulatory requirements.



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