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Tokenisation is the process of replacing a card’s primary account number (PAN) with a digital payment token. When a cardholder adds a card to a digital wallet, the card Scheme creates a payment token that represents the card. The token can be used for payments while keeping the original card number protected. The relationship between the token and the underlying card is maintained by the card Scheme’s tokenisation service. This improves security because merchants do not receive the original card number during tokenised transactions. Instead, transactions are performed using token credentials that are managed independently of the underlying card. A single card can have multiple associated tokens. Depending on the token type and payment scenario, tokens can be device-specific, merchant-specific, or cloud-based. For example, if the same card is added to a phone and a smartwatch, separate device-specific tokens are typically created for each device.

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How Tokenisation Functions

When a card is added to a digital wallet, it is tokenised — the Funding Primary Account Number (FPAN) of the card is replaced with a Device-Specific Network Token (DPAN), and the token is used in processing transactions. Hence, during transactions, merchants receive the token rather than the underlying card number, reducing the exposure of sensitive card information and enhancing payment security.
The token is a secure payment credential issued and managed according to digital wallets and the card Scheme requirements.
  • Tokens are shared in the payment processing network, instead of the real card number.
  • Token lifecycle changes are communicated with the card scheme: Updates are shared after the events are triggered, and not instantly.
  • Each token has its own status and is applicable per wallet/per device.

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Payment Processing with Tokens

Once a token has been provisioned and activated, it can be used for payments in the same way as a physical card. The key difference is that digital wallet transactions use token credentials rather than the original card number. A simplified transaction flow using a token is explained here:
1

First Step

The cardholder initiates a payment using a digital wallet.
2

Second Step

The payment is processed using the digital wallet token, instead of the original card number.
3

Third Step

The transaction details are routed through the card Scheme.
4

Fourth Step

The card Scheme includes the token-related information required to process the transaction.
5

Fifth Step

Enfuce receives the authorisation request that includes the token-related information.
6

Sixth Step

Enfuce validates and processes the transaction, as per the usual authorisation processing rules.
7

Seventh Step

The transaction is either approved or declined.
The original card number is never shared with the merchants, yet the transaction is still linked to the underlying card via the token.

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Types of Tokens

This is the original card number that Enfuce assigns. Enfuce generates a card number and it is associated with the cardholder’s account. The FPAN is not shared with merchants during tokenised transactions.
DPAN is a device-specific payment token created when a card is provisioned to a digital wallet. Each device typically receives its own DPAN. For example, if the same card is added to an iPhone and an Apple Watch, separate DPANs are typically created for each device. DPANs are used for in-store contactless payments and many wallet-based online transactions.
A Mastercard-specific cloud token used in Apple Pay. APANs are not device-specific and are used for certain Apple Pay payments. APANs are designed for Apple Pay experiences where a single authentication can support payments involving multiple merchants. This is commonly used in travel and marketplace scenarios where several merchants participate in the same purchase journey.
Merchant Payment Account Number is a merchant-specific network token used for credential-on-file transactions. Unlike a DPAN, an MPAN is associated with a merchant rather than a specific device. MPANs are commonly used for recurring and merchant-initiated payments such as subscriptions.