The payment vault: using tokenization to optimize your checkout experience

As an e-commerce merchant, your challenge is to offer your customers a payment journey that strikes the perfect balance between transaction security and user experience.

Thanks to credit card tokenization, you can achieve a 95% payment acceptance rate while improving checkout fluidity. Let’s explore how to make the most of it.

What is a vault in the context of card payments?

In payments, a vault involves storing card data in a secure environment so it can be reused later. In exchange for the card number, a token is assigned to a customer based on their payment method and card number, then communicated to the merchant by the payment service provider. This token can only be used by the merchant within their own environment and replaces sensitive data with non-sensitive data to make it easier to handle.

Usually, this tokenization is provided by the PSP, which captures the information during payments. However, most large e-commerce sites use at least two payment providers, and that’s where things can quickly get complicated.

By moving vault management to the payment orchestrator level, Purse offers you a powerful advantage: agnosticism, and therefore flexibility, in managing your card payment data!

• Agnosticism regarding 3DS authentication : by decoupling authentication from authorization, you can use 3DS authentication regardless of the PSP, at the beginning and/or end of the transaction.
• Agnosticism regarding storage : the generated token is not dependent on a specific PSP; it can be used to retrieve the card and transmit it to the right provider at the right time.

‍How Purse turns tokenization into a strength for your e-commerce business

When we talk about tokenization, we first think of One-Click payments, but it goes much further than that.

We have designed a set of value-added services to give you the ability to manage card data without having to handle sensitive information yourself.

1. The payment widget: simplicity and efficiency

This tool is the visible part of the functionality: the one your customer will use when paying. It is the interface that displays the list of payment methods and includes the payment forms that can be integrated directly into your checkout.

Here is what you can do:

• Dynamic network routing: You are now required to offer customers a choice of payment scheme, even though they often don't know what to click. With dynamic network selection, the brand is automatically pre-selected to match the IIN (Issuer Identification Number), while still allowing the option to manually change the network (CB, VISA, Mastercard, etc.).

• Card registration: offer cardholders the option to save their card and link it to their customer account with a simple checkbox.
  • The customer is free to choose whether or not to save their card.
  • Registration can take place before or after authentication, depending on the payment method used.
  • Customers can save multiple payment methods (credit card, PayPal account, etc.).
  • The payment method will then be added to the customer's wallet within their account to simplify future payments on your site.

• Payments with a saved card :
  • For subsequent payments: if the customer is logged into their account, their payment method will be automatically displayed and offered in the payment widget for One-Click checkout.
  • Option to remove a payment method from the list of saved payments.
  • Option to add a payment method.

2. Tokenization for greater flexibility and a frictionless journey
   
   If you currently use multiple PSPs, you are juggling multiple tokens. If one partner becomes unavailable or you switch providers, managing tokens can become a real headache and lead to payment failures, as PSP environments are siloed from one another.
   
   The main benefit of entrusting vault management to your Purse payment orchestrator is the flexibility to use card payment data regardless of which payment provider processes the transaction. Purse handles the security and transmission of card data within a top-tier PCI DSS environment.
   
   Another advantage of tokenization is the ability to qualify for PSD2 exemptions. The real challenge is being able to offer a frictionless journey while remaining compliant with the Payment Services Directive. Several options are available to you for offering a payment journey without strong authentication while still controlling fraud risk:
   

• Tokenized cards belong to customers you already know, so the risk of fraud is low. Although the final decision rests with the issuing bank, you can request a frictionless payment for these cards, which is more likely to be approved.
• Recurring payments: for recurring payments with a fixed amount and beneficiary, you qualify for the exemption.
• Finally, thanks to its Fastpass solution, our partner Payplug achieves an impressive 97% acceptance rate for cards issued by the BPCE group. This represents approximately 24% of cards in France, and therefore potentially… 24% of your customers.

3. Card routing: optimizing the payment process
   ‍
   Card routing refers to the path a card takes to reach the correct acquirer. This is the technical backend, invisible on the payment page, which Purse orchestrates.
   
   Once the card reaches Purse, where it is stored and secured, we can route it to the best possible destination, depending on the payment context.
   
   Here are a few examples of how card routing can improve the customer experience:
   

• Managing backups:
  
  • By activating an automatic retry function: if an error occurs during the payment process, the previously stored payment data can be sent back to the payment provider to re-attempt the transaction without any action required from the buyer.
  • By activating a fallback function: if your primary payment provider fails during a transaction, you can route the payment to your secondary provider without the customer needing to re-enter their card details. Regardless of the original PSP, we can route the card to another provider.

PSP outages are rare, but they do happen, and they can be catastrophic for your e-commerce business and your customer experience. With this optimized backup management, an outage remains invisible to everyone!

• Managing "on-us" routing :
  By reading the IIN (Issuer Identification Number), we can detect the cardholder's bank and, based on your routing rules, send it to the acquiring partner of your choice.
  
  
• PSP A/B testing:
  For a set period, use card routing to A/B test multiple payment providers. Analyzing the payment results will then allow you to build the optimal routing rule combination for your e-commerce site.
  
  The benefits of payment data tokenization for your e-commerce site

The range of features enabled by card tokenization should give you a glimpse of what's possible.

The benefits are numerous and have an impact on several levels:

For the merchant:

1. Technical benefits for your e-commerce
   

• Security :
  
  • Regulatory compliance:
    • you don't have to manage any sensitive data; everything is handled by Purse: GDPR compliant and PCI DSS secure storage.
    • Dynamic brand display managed by Purse based on the card number.
  • Fraud reduction: saved cards come from known customers, have a higher acceptance rate, and very low fraud levels on these profiles.
  • Payment provider agnostic solution, a single integration.

• Integration:
  
  • Included in the Purse integration: everything we are talking about here is doable once you go through us; it's included in the service!
  • Ease of implementation: the solution's intelligence is managed on the Purse side.
  • Backup management without touching the customer journey: possibility of having backup solutions with no impact on the customer experience!
  • Payment provider agnostic solution, a single integration.
  • Import tokens from your existing PSP into our vault.

2. Marketing benefits impacting your revenue:
   
   
   • Optimize the acceptance rate : all the mechanisms put in place will automatically increase your acceptance rate: known customers, rules that allow for transaction retries, increased frictionless payments… and what if you could reach an acceptance rate of up to 95%?
   • Increase the conversion rate : the Holy Grail is to make payment invisible in the shopping experience. With One-Click payment, you offer a simplified payment process, which means a boosted conversion rate.
   • Customer loyalty: an essential tool for your recurring customers. If you are lucky enough to have loyal customers who pay regularly on your site, they should feel recognized and enjoy a smoother experience, without having to go through a cumbersome and tedious payment process every time. Be a love brand right through to the checkout.
   • Increase friction-free payments on your site : seamless payment is the guarantee of a better user experience, a fluid journey, and a completed purchase. Do you know your customers? The risk is lower; define the rules for transactions where you can request a friction-free payment. Our experts will help you make and configure these choices.

‍       3. Financial benefits

Opting for intelligent card routing that allows you to choose the provider based on the cardholder's bank can save you significant amounts on the commissions negotiated with your banking providers.

• Brand selection: a poor network choice by the customer (due to lack of knowledge) can be costly for you. Dynamic selection allows you to manage this risk.
• Increased friction-free payments = Increased acceptance = Increased revenue

Conclusion

Implementing a payment vault solution is a major strategic challenge for any e-retailer looking to protect their customers' sensitive data, with a trusted partner capable of providing a complete solution that combines universality, security, and transaction optimization.

So, are you ready to transform your payment journey and maximize your conversions?

Our experts address the specific challenges of your business.