New Zealand payments leaders commit to making online shopping safer and easier for merchants and consumers
- Payments leaders commit to rolling out a technology that will strengthen e-commerce security and improve conversion rates for New Zealand merchants
- The technology will mean consumers no longer need to update payments details following a card refresh – a task that 44%* of Kiwis say is the most annoying part of losing a card or having it expire
New Zealand payments leaders Adyen, Bambora, Cybersource, Paystation by Trade Me, and Windcave, have committed to rolling out a new payment technology in part-nership with Visa, making New Zealand one of the first countries to introduce the capability. Called creden-tial-on-file (COF) tokenisation, the technology will strengthen e-commerce security and enhance conver-sion rates, resulting in savings for businesses and a simpler payment experience for everyone that shops online.
COF tokenisation replaces card details such as account numbers and expiry dates with unique digital iden-tifiers (‘tokens’) that are used for payment without exposing a cardholder’s sensitive information. Each to-ken is merchant-specific, so can only be used with the merchant where it is stored, removing any incentive for hackers to try to steal the account data and decreasing the risk of data breach attempts. Businesses usually store card numbers for direct debit, top-up, loyalty, subscription or account-based online shopping. This same technology is used to enable the various mobile wallets that are available to Kiwis today.
“This commitment to drive tokenisation across the industry represents a win for New Zealand businesses, consumers, financial institutions and payments companies alike. The technology enhances consumers’ experience, enables retailers to retain consumer loyalty and protects all businesses from fraud. With the advent of open data and the creation of new experiences based on data, initiatives such as tokenisation will ensure consumer data is protected and held securely,” said Riaz Nasrabadi, Visa’s Head of Product for New Zealand and South Pacific.
In addition to enhancing security, COF tokenisation enables businesses to have consumer payment details instantly refreshed when a card is lost, stolen or expires, meaning there is no need for the consumer to log in and update their details, or the business to lose out on that payment cycle.
This development will be welcomed by Kiwi consumers, with a YouGov survey finding that 44% identify updating pre-existing details with merchants and service providers among the most annoying conse-quences of losing a card or having it expire*.
COF tokenisation is a win for New Zealand merchants too, with higher conversion rates and less time spent chasing payments likely to result in savings. The survey also found that nearly one third (26%) of Ki-wis take over two weeks to update their details when they lose a card or have it expire, and 10% take more than a month*.
The automated process could also help prevent online merchants from missing out on subscription renew-als, with 19% saying they would use the manual card update to try out an alternative, and 13% opting to stop using a service altogether*.
With tokenisation in place protecting their card details, 37% of New Zealanders said they would be more likely to purchase from small retailers, 46% would be more trusting of online businesses, and 36% said they would buy from retailers they had not bought from in the past*.
“New Zealand businesses, including retailers, are operating in an increasingly competitive and global land-scape, in which every dollar not spent on addressing problems could be invested in business growth. The opportunity to enable this growth for Kiwi businesses is the motivation driving this cross-industry collabora-tion,” said Nasrabadi.
This partnership with major New Zealand payments gateways reinforces the strategy behind Visa’s Future of Security Roadmap, which sets the direction for New Zealand payments security from 2018 to 2020, and beyond. Comprised of five initiatives, the Roadmap will ensure security continues to evolve at the same pace as innovation.
*YouGov survey of 500 New Zealanders with a debit / credit card, July 2018
About Visa Inc.
Visa Inc. (NYSE: V) is the world’s leader in digital payments. Our mission is to connect the world through the most innovative, reliable and secure payment network - enabling individuals, businesses and econo-mies to thrive. Our advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The com-pany’s relentless focus on innovation is a catalyst for the rapid growth of connected commerce on any de-vice, and a driving force behind the dream of a cashless future for everyone, everywhere. As the world moves from analog to digital, Visa is applying our brand, products, people, network and scale to reshape the future of commerce. For more information, visit About Visa, https://usa.visa.com/visa-everywhere/blog.html and @VisaNews.