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Mastercard plans to eliminate traditional credit card numbers and adopt tokenization technology to reduce the risk of information leakage.
The development was reported by Singapore-based publication Lianhe Zaobao, which outlined Mastercard’s latest move to address the growing problem of online fraud.
Tokenization technology replaces sensitive data, such as credit card numbers, with randomly generated digital strings known as tokens. These tokens replace the original data during storage and transmission, significantly reducing the risk of a data breach. Mastercard CEO Michael Miebach said the company aims to expand the use of this technology and replace traditional passwords with biometric identification methods such as fingerprints or facial scans.
The initiative is part of Mastercard’s strategy to combat online payment fraud, which is expected to cost the company more than $91 billion by 2028. Mastercard first implemented tokenization technology a decade ago, and it initially took three years to complete its first billion-dollar transaction using the method, Bloomberg reported. Today, the company can process the same volume in just one week.
*This is not investment advice.