New Tech Facility : In a major initiative, the Reserve Bank of India has started the Card-on-File (COF) token facility at the level of banks and other institutions. With its help, customers will be able to create a token of their debit or credit card and link it to their accounts of various e-commerce apps. Earlier, COF token could be generated only through the seller’s app or web page. With the help of COF token, payment can be made without giving actual card details while making online payment.
With the implementation of card tokenization system, customers will be protected from data theft and financial fraud. RBI said in a circular, COF token can be generated directly through the card issuing banks/institutions. This will give cardholders the additional option of tokenizing their cards for multiple vendors at once. The physical card details, such as the 16-digit number, validity date and CVV number, will be replaced by a virtual code in the COF token. This is not mandatory for cardholders, but it is a secure way to transact online as it does not require sharing actual card details.