Mastercard's MDES For Merchants ensures data, payments safely stored

MDES for Merchants uses a security measure known as tokenization to encrypt consumer payment details in a unique way with each retailer.

Mastercard today announced that it is the first and only payment provider in Australia and New Zealand to roll out the latest card on file tokenization technology in 2019. ‘MDES For Merchants’ ensures customer data and payments are safely stored and maintained in consumers’ favorite websites and apps. The technology could reduce online fraud by approximately 30 percent, or $146 million, while also ensuring customer pain-points are addressed, by automatically updating their payment details directly with the retailer, whenever a card is lost or replaced, avoiding the customer needing to manually update.

Online fraud is a growing threat to businesses in Australia, with AU$488 million loss as a result of last year alone. Across the world, it’s a similar picture with card-not-present fraud expected to cost retailers US$130 billion between 2018 and 2023. It also has a significant impact on customer experience with research showing that 66 percent of cardholders that experienced a false decline when transacting online, reduced or stopped shopping with that retailer altogether.

MDES for Merchants uses a security measure known as tokenization to encrypt consumer payment details in a unique way with each retailer. Tokenisation does this by replacing card numbers with digital tokens and every time a transaction is made online or with a mobile wallet, a unique token is created to make the payment. That way, if retailers get breached, there’s nothing to steal, as the 16-digit card number is not stored anywhere. Furthermore, consumers receive the added benefit of never having to update their card details with retailers when their original card is replaced. MDES for Merchants will seamlessly pass the new details to the retailer at the point of the next payment.

Surin Fernando, Vice President, Business Development, Mastercard said; “Mastercard’s MDES for Merchants tokenization technology supports both online retailers and their customers to increase the number of successfully approved purchases made online. As well as protecting retailers from data breaches the technology offers greater fraud protection to merchants and customers. The technology works to deliver a safer, higher approval rate while simultaneously working to delight cardholders at the point of checkout. By doing this, Mastercard has seen an increase in purchase conversion and a decline in cart abandonment.

In Australia, the lead up to Christmas sees a ramp-up of retail spending, making this the perfect time for launch. In addition to retailers, Mastercard cardholders can expect to benefit from the improved customer experience. For example, in the case their card is lost, stolen, replaced or expired, customers can expect their stored card details to be automatically updated. The technology also allows consumers to keep track of where they have saved their card information across retailers, ride-sharing, TV streaming, online marketplaces, telco and utility platforms.”

Leading Australian and New Zealand payment processing companies such as Fat Zebra, Bambora, Eway, Card Access Services, Datacom, IPSI, Securepay, Adyen, Paystation by Trade Me, Integrapay, Merchant Warrior, and Windcave (formally Payment Express) are just some of Mastercard’s partners enabling this technology to assist both retailers and consumers in 2019 and into 2020.

Leading financial institutions who issue customer cards such as the Commonwealth Bank, Bankwest and Bendigo Bank are amongst those rolling out this solution with a more following suit. Mastercard and its partners are at the forefront of protecting customers against cyber threats in Australia, implementing the latest advances in tokenization when transacting online.

Paul Vivian, Bankwest General Manager Customer Solutions and Insights said; “With increasingly sophisticated methods being used to target businesses, causing financial and reputational hardship, it’s important for businesses to strengthen their defenses.

We are committed to creating the best possible experience for our customers including how they like to pay. MDES for Merchants automatically update customers’ payment details when a card is replaced so customers no longer need to manually update all of their card details with each retailer.”