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Visa to launch tokenization service for wearables, smart devices

Image: Visa

Visa Inc. has put together a slew of new offerings to secure online payments – not just for the desktop, but for smart devices and wearables.

On Thursday, the payments processor said it’s introducing Visa Token Service, which would see consumers using tokens instead of their 16-digit numbers on their credit cards. That would allow them to securely use their smart devices and wearables to make payments.

Tokens replace sensitive data, often appearing as a string of random characters that can’t be decrypted and that are meant to substitute for the actual cardholder data itself. These tokens would be housed inside mobile devices, through e-commerce applications, and within cloud-based mobile applications.

Not only are tokens being touted as more secure than using the 16-digit card number data, they’re also being branded as “convenient and cost-effective,” as consumers who’ve lost their mobile devices can request new tokens without changing account numbers or having to request new plastic cards.

Alongside its Token Service, Visa also announced it’d be packaging some of its mobile-friendly products together into a new suite called Visa Digital Solutions. The suite includes Visa payWave, which uses near field communication technology to allow customers to just wave their phones at a reader to make payments, and the ability to pay using QR codes.

It also includes Visa Checkout, one of Visa’s newest products. Last week, we reported on the launch of the new feature, which allows consumers to save their credit and debit card information to an account.
They can their skip entering billing and shipping information when they buy something online.

During that product launch, Visa executives said they’d be using triple data encryption, multi-factor authentication, and so on to bolster security, but details were scarce – so the company’s latest announcement about Visa Token Service has filled in some of the gaps there.

Visa Token Service is set to be introduced in the U.S. in September, though it will be made available outside the U.S. in 2015.

While some of the products within the Visa Digital Solutions suite are available now, the full suite will be released in the U.S. in January 2015. Canadian availability has yet to be announced.

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