New anti-fraud payment technologies coming to Russia

Visa and MasterCard, together with the National System of Payment Cards (NSPK), plan to launch tokenization technology that will allow consumers to make purchases with Apple Pay, Android Pay, and Samsung Pay. A ''token'' is a unique digital identifier that replaces a client’s bank or credit card number.

Visa's chief executive officer in Russia, Ekaterina Petelina, told Vedomosti daily business newspaper that Visa and NSPK are working on launching a contactless payment technology this autumn that allows payments with mobile devices. MasterCard also plans to bring Apple Pay, Android Pay, and Samsung Pay to the Russian market.

“Tokenization technology is one of today's most important security developments because it provides the safest way of non-cash payments,” MasterCard representatives told RBTH.

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With tokenization the payment terminal can scan a person's token from his/her mobile device and then pass it to an acquiring bank as a part of an authorization request. Visa said on its website that, ``tokens are secure because they can be device specific, or retail specific. A unique token is created for every device from a single account. For example, a token created for contactless use cannot be used online.''

“This is a very effective system to combat fraud because you don't need to secure your account information against exposure,'' Petelina told Vedomosti. ``Instead, you simply make such information useless to criminals. This is a completely different way of providing security.''

Visa and MasterCard first introduced tokenization technology in the U.S. in 2014, and have actively expanded it to other countries. According to MasterCard, their digital enablement services (MDES) are working in 18 European countries as of April. 

Even more innovations are coming to the realm of Russian digital commerce. 

“Russia’s largest bank, Sberbank, plans to offer client identification via video image processing by 2018,'' said Yaroslav Loginov, founder of the crypto-currency system, LibreMoney. ``You won’t have to bring a card or phone with you. It will be enough to look at the camera and just speak a confirmation word or phrase.''

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