Q&A: Create a more secure business with Network Tokenization

We talk to a PayPal expert about protecting your business and improving the shopping experience.

Security should never come at the expense of the customer experience. Network tokenization can help improve protection while creating a more seamless checkout. While you've likely heard of network tokenization, you may still have some questions about how it works and why it's a technology you should investigate for your business. Below we answer a few of the most common questions we get asked about network tokenization.

What is network tokenization?

Let’s start with tokenization, which is a string of numbers that represents the real numbers on a credit card. Merchants have been using tokenization for several years to help keep customer credit card information secure. Network tokenization builds on this by including the card network in the tokenization process. This unlocks new value for businesses and convenience for customers.

How does network tokenization unlock new value?

With standard tokenization, a token is static. If a customer’s card is lost or stolen, the token doesn’t change. But with a network token, a lost or stolen card can be updated by the card networks. From the customer’s point of view, everything is handled behind the scenes and the customer doesn’t have to re-enter their information if their card details change. That’s good for the customer and good for the business.

That’s why in a recent survey of merchants, 32% said they leverage network tokenization to update card information and increase authorization rates.¹

Standard tokenization works well. Why should my business start using network tokenization now?

Network tokenization is the future. Not only is it more secure and less costly, but because it’s connected to the card network it reduces latency and improves the customer experience. Network tokenization is becoming the new paradigm and businesses should be prepared.

Will adopting network tokenization disrupt my business?

Choosing the right guide through the process is critical. Businesses moving to network tokenization need a guide who can help mitigate against lower authorization rates at the beginning and who can craft hybrid strategies that are tailored to a particular business's needs.

Early adopters have been pleased. We found that 92% of PayPal Braintree using network tokenization say the feature has met or exceeded their expectations.²

How is PayPal helping to advance Network Tokenization?

We’re excited about the future of network tokens. With 850 million cards tokenized, PayPal Braintree is already one of the biggest token service providers in the world. Because of our scale, we partner closely with card networks to innovate at the cutting edge of network tokenization. Our close relationships with the card networks allow us to be early adopters of new network token technologies that help businesses take full advantage of the growing ecosystem.

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