When it comes to data security, finding the best solution isn’t always the easiest task. Organizations need to evaluate their data environments and other internal systems to determine where weaknesses lie, how to address them, and what applicable solutions exist on the market. These and many other unique variables must be considered before choosing a technology, much less a provider, and none should be overlooked or taken lightly. This is why choosing the right security vendor is so important. Security must work 100 percent of the time. If it fails or becomes compromised, the damage cannot be undone.
So the question becomes: How does an organization operate within the confines of global privacy regulations and other compliance obligations without hampering or significantly disrupting business-as-usual processes? The answer is reducing risk via data minimization, descoping, deidentification, and secure vault storage. Tokenization provides all four to achieve maximum security and scope reduction. Now onto the next question: What is the tokenization of data?
Tokenization is the process of sending sensitive data via an API or batch file to a tokenization provider who then replaces that data with nonsensitive placeholders called tokens. It can be used to secure and desensitize data by replacing the original data with an unrelated value of the same length and format. The tokens—which, in the interest of maintaining business utility, can retain elements of the original data—are then sent to an organization’s internal systems for use, and the original data is stored in a secure token vault.
Unlike encrypted data, tokenized data is undecipherable and irreversible. This distinction is particularly important: Because there is no mathematical relationship between the token and its original number, tokens cannot be returned to their original form. Instead, when detokenization is required, the token is exchanged for the original number. This can only be done by the original tokenization system—there is no other way to obtain the original number from the token alone. So if a breach occurs, the exposed data is worthless to cybercriminals, virtually eliminating the risk of data theft. Tokens can be single-use (a one-time debit card transaction) that are not retained, or multi-use (a credit card number of a repeat customer) that is stored in a database for recurring transactions.
Encryption is a process during which sensitive data is mathematically changed, but its original pattern is still present within the new code. This means encrypted numbers can be decrypted with the appropriate key, through either brute computing force or a hacked/stolen key.
The goal of a tokenization platform is to remove any original sensitive payment or personal data from your business systems, replace each number with an undecipherable token, and store the original data in a secure cloud data vault, separate from your business systems. Tokenization in banking, for example, protects cardholder data. When you process a payment using the token stored in your systems, only the original tokenization system can swap the token with the corresponding PAN (primary account number), and send it to the payment processor for authorization. Your systems never record, transmit, or store the PAN—only the token.
Although no technology can guarantee the prevention of a data breach, a tokenization platform equipped with off-site data vaulting can prevent the exposure of sensitive data, stopping attackers from capturing any type of usable information—financial or personal. “Usable information” is the key here. Tokenization is not a security system that stops hackers from penetrating your networks and information systems. There are many other security systems designed for that purpose. However, no defense has proven to be impenetrable. Whether through human error, malware, phishing emails, or brute force, cybercriminals have many ways to prey on vulnerable organizations. In many cases, it’s a matter of when—not if—an attack will succeed. The advantage to tokenization and cloud data vaulting is there is no information to steal when the inevitable breach happens. Because of this, it virtually eliminates the risk of data theft.
Recap: What is Tokenization?
The purpose of tokenization is to swap out sensitive data—typically payment card or bank account numbers—with a randomized number in the same format, but with no intrinsic value of its own. This differs from encryption where a number is mathematically changed, but its original pattern is still “locked” within the new code—known as format-preserving encryption. Encrypted numbers can be decrypted with the appropriate key—through either brute computing force or a hacked/stolen key.
Tokens, on the other hand, cannot be decrypted because there is no mathematical relationship between the token and its original number. Detokenization is, of course, the reverse process. The token is traded back—but not decrypted—for the original number. Detokenization can only be done by the original tokenization system. There is no other way to obtain the original number from just the token. Tokens can be single use (a one-time debit card transaction) that are not retained, or multi-use (a credit card number of a repeat customer) that is stored in a database for recurring transactions.
For more information about tokenization, the TokenEx Cloud Security Platform, or our many security applications, visit the pages linked below.
As online and other forms of card-not-present transactions proliferate around the world, organizations that accept card payments need an omnichannel strategy. TokenEx supports omnichannel acceptance, enabling the flexibility to do business wherever payments are occurring.
Most tokenization solutions offered by payment processors or other service providers deal only with payment data, not PII, HIPAA data, or any of the other data sets covered by diverse international rules and regulations. TokenEx provides versatile tokenization solutions to secure any data type and meet any compliance obligation.
The TokenEx Cloud Security Platform is an open-integration platform, and as such, it provides a wide selection of industry-standard token formats for you to use. Review our many token schemes to see which one is right for your organization and its sensitive data.
TokenEx transparent tokenization and detokenization operates seamlessly between your business environment and your partners’ booking engines and payment processing systems, keeping sensitive data out of your business and IT environments.