EMV Payment Card Tokenization for Fraud Reduction
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Solution Overview
Problem
Existing payment systems, including EMV cards, expose primary account numbers (PANs) and sensitive cardholder data during transactions, making them vulnerable to fraud and data breaches, particularly in cross-channel fraudulent activities.
Innovation Solution
EMV payment cards are personalized with payment tokens stored in electronic chips and magnetic stripes, allowing only tokenized information to be read during transactions, with domain restrictions applied to prevent unauthorized usage of stolen tokens, thereby reducing fraud exposure.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If payment cards store and transmit primary account numbers (PANs) and sensitive cardholder data during transactions, then payment processing can proceed normally, but the system becomes vulnerable to fraud and data breaches
Solution Approach 1:
The patent introduces payment tokens as intermediary values that replace PANs and sensitive cardholder data during transactions. The token service provider acts as a mediator that issues tokens representing payment accounts, allowing transactions to proceed without exposing actual account numbers. The token can be translated to PAN only when necessary and with proper authorization, thus reducing fraud exposure while maintaining payment processing functionality.
Solution Approach 2:
The patent creates a copy of the payment account identifier in the form of a payment token that can be used instead of the actual PAN. This token copy maintains the functional equivalence for transaction processing but lacks the sensitivity and permanence of the original PAN, thereby reducing the harmful effects of data breaches and fraud while preserving payment system reliability.
2Reliability
If payment tokens are used to replace PANs in the payment system, then fraud protection is improved, but the complexity of the payment processing system increases
Solution Approach 1:
The token service provider serves as a centralized intermediary that manages the complexity of token generation, translation, and validation. This mediator abstracts the complexity from individual payment processing systems, allowing them to interact with tokens without needing to understand the underlying PAN structure. The service provider handles the intricate mappings and security protocols, thereby improving fraud protection while limiting the complexity increase to a dedicated service layer.
3Adaptability or versatility
If EMV cards store PANs in electronic chips and magnetic stripes, then card functionality is maintained, but sensitive data is exposed during contactless and contact transactions
Solution Approach 1:
The patent extracts the sensitive PAN information from the card's storage media (electronic chip and magnetic stripe) and replaces it with a payment token. The token serves as a surrogate that maintains card functionality for both contactless and contact transactions while eliminating the exposure of sensitive data. The actual PAN is extracted only when necessary for translation by the token service provider, not during routine transaction processing.
Solution Approach 2:
The patent changes the fundamental parameter of data storage from PAN to payment token. This parameter change transforms the nature of the stored information from sensitive and exposed to secure and protected. The payment token maintains the necessary functionality for transaction processing while fundamentally altering the data characteristic to prevent sensitive information exposure during card reading operations.
Data Source
AI summary
Provided are a payment card, system and method for storing and reading tokenized payment account information from a payment card. In an exemplary embodiment, a payment card may include a substrate forming a body of the payment card, and an electronic chip attached to or included in the substrate. According to various exemplary embodiments, the electronic chip may include a storage storing tokenized payment account information corresponding to a payment account linked to the payment card. The electronic chip may be read by a payment terminal and may provide the tokenized payment information to the payment terminal during reading.