Visa has announced that the adoption of Visa Token Service (VTS) in 2023 led to a significant boost of over USD 2 billion in the digital economy of the Asia Pacific region. This milestone highlights the substantial benefits tokens provide to digital commerce, both online and in-store, with the number of tokens surpassing the 1 billion mark in Asia Pacific.
VTS substitutes the traditional 16-digit debit or credit card number with a distinct identifier known as a token, accessible only by Visa. These tokens ensure the security of payment credentials, facilitating the transmission of enriched data. Consequently, this enhances payment success rates and reduces instances of fraud. Combined with seamless compatibility across various devices, these advantages contribute to an enhanced consumer experience.
Tokens also enhance payment processing by facilitating increased control and enhancing data exchange during each transaction. These enhancements have minimized instances where valid transactions are declined by payment systems, an inconvenience for both consumers and merchants. Merchants utilizing VTS for their digital payments have observed a notable increase in payment success rates, resulting in an authorization uplift of USD 2 billion, alongside a significant decrease in payment fraud rates by over half (58%).
"Consumers and businesses alike expect payments to be secure and seamless and network tokens are the enabler. With the authorization uplift and lowered fraud rates, merchants can focus more of their valuable time and resources on product innovation and customer engagement. We encourage more merchants to adopt tokenized payments as this technology can make a direct impact on their top and bottom lines", said Previn Pillay, Head of Merchant Sales & Acquiring, Asia Pacific, Visa.
Visa is broadening the scope of modern payment experiences facilitated by tokenized credentials in online settings. Through tokens, consumers are relieved from the task of manually inputting their 16-digit credentials during online transactions, as well as the burden of updating their card information across various platforms when their card expires or is replaced. Likewise, VTS guarantees that merchants can securely update their customers' payment details via Visa's platform, thereby providing customers with smooth, uninterrupted payment processes and fewer instances of authorization declines, whether they are using a smartphone, wearable device, or smart appliance.
"Tokens pave the way for the future of commerce as the innovation possibilities are immense with tokenized payment credentials that can unlock new and more personalized consumer experiences beyond physical Visa cards. We continue to build on the capabilities that modern credentials offer, together with our partners, to bring more value to the entire payment ecosystem", said TR Ramachandran, Head of Products and Solutions, Asia Pacific, Visa.