Technical
Network Token
Definition
Network Token a token provisioned by the card network (Visa, Mastercard) rather than the PSP. Network tokens are updated automatically when cards are reissued, improving approval rates for stored cards. Also called scheme tokens. Offer better security and authorization rates than PSP tokens. Essential for subscription businesses to reduce involuntary churn.
Related Terms
Tokenization
Replacing sensitive card data with a non-sensitive token that can be stored safely. Tokens are useless if stolen - they can only be used by the merchant they were created for. Enables card-on-file functionality without storing actual card numbers. Reduces PCI scope significantly. Network tokens (from Visa/MC) offer additional benefits including automatic card updates.
Card-on-File
Storing customer payment credentials for future transactions without requiring re-entry. Essential for recurring billing, one-click checkout, and repeat purchases. Must use tokenization for PCI compliance. Card networks have specific rules including obtaining consent and identifying stored credential transactions. Network tokens improve approval rates for card-on-file.
Card Updater
Services that automatically update stored card credentials when cards are reissued or replaced. Visa Account Updater (VAU) and Mastercard Automatic Billing Updater (ABU) provide new card details to merchants. Essential for subscription businesses to reduce involuntary churn from expired cards. Updates happen during batch processes - not real-time.
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