November 19, 2025 • 30 mins
Payments shouldn’t break just because a card changes. We sat down with leaders from NMI, G+D and Mastercard to unpack how network tokenization has moved far beyond basic security to become the backbone of higher approvals, fewer chargebacks, and smoother recurring billing. If you care about conversion, fraud, and customer lifetime value, this conversation goes straight to the signal.
Tiffany Johnson, CPO at NMI, Mark Van Horn, Digital Solution Lead, North America at G+D and Ryan Francis, Vice President, Digital Product at Mastercard start the episode by clarifying what network tokens are and how they differ from traditional vault tokens, then dig into the metrics that matter: consistent 3–6 percentage point authorization uplift, real-world portfolio wins that stretch even higher, and measurable savings from reduced retries and smarter routing. You’ll hear how merchant-bound and device-bound tokens give issuers reliable context, why lifecycle management keeps subscriptions uninterrupted, and how those improvements cascade into lower operational costs and stronger retention.
From there, we look ahead. Tokens are becoming the default for card-not-present payments and will extend into open banking and account-to-account flows. With AI on the rise and agentic commerce coming into view, tokens provide portable trust - binding identity, device, and permissions so agents can transact safely on our behalf. The guests share how G+D and NMI make token adoption turnkey for ISVs and platforms, and how Mastercard is scaling token rails to power seamless, intelligent commerce.
If you’re an ISV, platform, or merchant seeking higher approval rates and lower fraud without adding friction, this is your blueprint.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (00:01):
Welcome to the Signal, powered by the Leaders
in Payments Podcast, where weare cutting through the noise to
reveal what truly matters inpayments and fintech.
SPEAKER_02 (00:13):
Hello, everyone, and welcome to the Leaders in
Payments Podcast.
I'm your host, Greg Myers, andtoday's special guests are Mark
Van Horn, the Digital SolutionLead North America at GND,
Tiffany Johnson, the ChiefProduct Officer at NMI, and Ryan
Francis, Vice President DigitalProduct at MasterCard.
So, Mark, Tiffany, Ryan, thankyou all for being here and
welcome to the show.
(00:34):
Thanks for having us.
Happy to be here.
So this episode is part of oursignal series where we're
cutting through the noise toreveal what truly matters in
payments and fintech.
Network tokens aren't just aboutreplacing pans, they're about
unlocking value across thepayments ecosystem.
So for software companies andISVs, they can provide
tremendous value.
(00:54):
And we're going to unpack justthat in this episode.
So, Mark, before we dive intothe meat of the conversation,
can you walk us through yourprofessional journey?
Tell us a little bit about whatGD does, especially as it
relates to network tokenization.
SPEAKER_03 (01:07):
Sure.
Yeah.
My payment journey startedprobably in the late 90s.
Worked for a company that had atransaction tracking program for
not-for-profit organizations.
That has eventually led me towhere I am today.
For the past four years, I'vebeen leading the uh digital
growth and enablement for GDhere in North America.
GD has done a great job over the170 years of its existence,
(01:30):
being a quiet player in thebackground.
But we do everything from uh simchips to uh creating currency to
uh being the third largestproducer of debit and credit
cards in the world.
So my team sits on the digitalsoftware that surrounds the use
of those cards, and thatincludes network tokenization.
So if a card on file, we helpaggregate the services from
MasterCard and the othernetworks to provide a single uh
(01:51):
implementation for our customersto utilize network tokens.
SPEAKER_02 (01:55):
Okay.
Tiffany, same question for you.
Can you walk us through yourprofessional journey and tell us
a little about NMI andespecially as it relates to
network tokenization?
SPEAKER_01 (02:03):
Of course.
So as you said, I am the chiefproduct officer for NMI.
I've been here about two and ahalf years.
I've been in payments for goingon 20 years.
And the whole journey, myprimary focus has been around
embedded platform payments.
And I'd say throughout mycareer, I've had the privilege
of working with incrediblecustomers and companies,
everyone from Apple and Uber tointo Amazon.
(02:24):
Even at one point, I helpedembed payments into Formula One.
So have a lot of experience inembedded payment strategies and
payments platforms.
And then a bit about NMI.
NMI is a global paymentsplatform.
We serve about 4,000 channelpartners.
So PayPax, ISOs, banks, ISVs,Sense platforms.
And through those channelpartners, they provide payment
(02:46):
services to over a million smalland medium-sized and in some
cases enterprise businesses aswell that are using our platform
to process payments as they selltheir goods and services.
So our mission at NMI is todeliver that full service
payments acceptance platform forour partners.
And it's fully white labeled.
So you may not have heard of us,but you've probably processed
(03:06):
transactions through us.
And as part of that vision, wethink network tokens are
critical to the acceptancejourney because of the lift it
creates and approvals, friction,everything that's important to
that payments journey.
And obviously, we'll be divingin today.
So thanks for having me.
SPEAKER_02 (03:22):
Absolutely.
So, Ryan, your turn, samequestion for you.
Can you walk us through yourprofessional journey?
Tell us a little bit about whatMasterCard does, especially as
it relates to networktokenization.
SPEAKER_00 (03:32):
Thanks, Greg.
Um, it's great, great to behere.
So, yeah, I basically the vicepresident of Digital Product for
North America at MasterCard.
I have over uh 22 years of ofpayments experience
predominantly on acceptance andsupporting acquirers and payment
service providers.
But uh my focus right now is isreally on building the next
(03:54):
generation of digital commerceexperiences.
So my team is really focused onmaking sure that payments remain
seamless, secure, andintelligent.
You know, from a MasterCardpoint of view, I mean, we've
obviously very much led the wayin terms of network
tokenization.
And really since their inceptionover you know 10 years ago now,
you know, we've continued toevolve the capabilities of
(04:18):
digital tokens.
And so continuing the work thatI've done over those years,
really, in terms of you knowworking with our acceptance
partners and issuing partners toscale our tokenization
footprint.
You know, we've got to a pointreally where more than 30% now
of MasterCard transactionsglobally are using um NDES and
tokenized Rails.
(04:39):
And that's even greater.
I mean, in in North America,it's around 50% now.
So, you know, tokenization hasreally been the foundation of uh
a lot of the uh the innovationand digital use cases that we've
come to see in uh come tofruition in recent years.
SPEAKER_02 (04:54):
Okay, great.
So let's dive into the topic fortoday's conversation, obviously,
network tokenization.
So, Mark, let's start with you.
Can you define generaltokenization and then tell us
maybe what the difference isbetween general tokenization and
network tokenization?
SPEAKER_03 (05:10):
Yeah, very simply put, uh, turning back the clock
to the early days of onlinetransactions and the internet
and e-commerce, and merchantsstarted storing PANS and payment
credentials for their customers,for repeat customers.
This was obviously highlysusceptible to fraud and and
breaches and things of thatnature.
So some smart people came upwith tokenization.
(05:31):
And this is basically the ideaof taking sensitive information
and turning it into anon-sensitive equivalent, right?
So this token is useless outsidethe realm of working with that
merchant.
Uh so if you steal a token, itto you can't really use it
anywhere.
This has really helped protectmerchants to have a lower
susceptibility to fraud.
But as it has evolved, it'sbecome necessary.
(05:53):
And Ryan and his team and hisequivalents have realized that
there's a real role there fornetworks to participate in this.
So the first iteration did agreat job of getting the
responsibility out of themerchants' hands, but that
responsibility then fell oncompanies like NMI to protect
that data.
In the newest version, we havethe actual tokens being
generated by the networks.
(06:14):
So Visa, MasterCard, AmexDiscover here at U in the US
primarily.
They in turn also have to beapproved by the issuing bank.
So those tokens have a furtherand greater degree of approval
and uh tied identity to thosecredentials for that specific
merchant.
So yeah, it's been a prettygreat evolution.
SPEAKER_02 (06:33):
So okay.
Well, Ryan, I'd love to get yourperspective on network
tokenization, especially kind ofas it relates to the broader
industry landscape and kind ofwhat's going on in that world
today.
SPEAKER_00 (06:46):
Yeah, thanks, Greg.
I think from my vantage point,um, yeah, what's really
compelling about networktokenization is how it's really
shifted from being a securitycontrol to a more broader
strategic growth enabler for theentire payments ecosystem.
So, I mean, you know, if youtake where we are today, network
tokenization is really becomingtable states.
(07:08):
You know, merchants usingnetwork tokens are typically
seeing anywhere uh in the regionof between three to six
percentage points ofauthorization uplift.
Um and that's really ameaningful difference, right?
You know, especially when youthink about the hundreds of
millions of transactions thatare being processed each day.
You know, and that and that'sreally not you know just because
uh you know tokenization is isjust swapping out a card number,
(07:30):
right?
It's you know, it's some verycritical trends and capabilities
around network tokenizationthat's driving that adoption and
that and that um capability.
So I think you know, three thatI can think of really around you
know lifecycle management beinga big part of network
tokenization.
You know, tokens obviouslyautomatically update when a card
is reissued or credentialschange, which you know really
(07:53):
helps cut down on unnecessarydeclines and and you know leads
to a better consumer experienceoverall.
And I think you know, obviously,with the help of partners like
NMI and uh GD, you know, we'vereally got to a point of
interoperability and scale.
You know, tokenization is nolonger really just scaled into
one wallet or one merchant.
(08:13):
You know, there's really acollaboration across across
networks, you know, issuers,gateways, merchants, and you
know, everyone's really workingtogether now in terms of you
know being able to use thosecapabilities.
And then that's reallyimportant, right?
You know, especially as we'reyou know entering a world where
you know payments become moreembedded, you know, more
intelligent.
And you know, we're we're gonnawe're getting to a point, I
(08:35):
guess, where you know thingslike agents are starting to act
on behalf of consumers andmerchants, right?
So, you know, tokens really doprovide uh the the ability for
merchants and issuers to makesure that they gain insights and
trust as part of the inbuiltcapability of the token itself.
So, yeah, uh, you know, I thinkas an industry we've really been
raising the bar on what tokenscan do.
(08:56):
And it's not really just aboutprocessing transactions, but
really helping drive, you know,drive business outcomes.
So higher conversion, strongerretention, less fraud, and
eventually becoming you knowinvisible infrastructure for
commerce as a whole.
SPEAKER_02 (09:10):
Okay, I think that's a great segue into the next
question, which I really want tobe a group discussion.
So, Mark, I'm gonna point thequestion at you, but Tiffany,
Ryan, please, please jump in.
And what we're gonna do is kindof break down the value of
tokenization into five areas.
So let's walk through each ofthose and have you give us your
(09:30):
thoughts.
So the first one is higherauthorate.
So, Mark, thoughts on that one?
SPEAKER_03 (09:37):
I think by its nature, a network token provides
a greater degree of certaintyfrom all the players
participating in thetransaction.
This is a credential that hasbeen pre-designated by the
issuer as an authentic token.
And therefore, when it issubmitted for a transaction and
it is tied to a specificmerchant using a certain domain,
right?
(09:57):
You can't use that network tokenif it's an e-commerce token to
then do some type of point ofsale or something along those
lines.
So you're creating a scenariowhere everyone who's
participating uh has seen thisbefore, recognizes it,
understands the format thatwhich being used, and therefore
creates a higher level ofauthorization rates.
Ryan uh mentioned some of thoserates, and and those are pretty
(10:20):
significant already.
Uh, we have some single usecases with certain specific
merchants that are evendramatically more high than that
authorization rate.
So it it's a it's a path bywhich these network tokens
really provide a real advantageover just using regular optimum
credentials.
SPEAKER_01 (10:37):
I would agree with that because of those benefits,
you know, and in MasterCardVisa, JP Morgan, there's a lot
of studies out there wherepeople quote, you know, a three
to four percent uplift inauthorization on top of
meaningful reduction in onlinefraud.
But I will say within our NOIportfolio with the partners that
have enabled networktokenization, we're seeing
anywhere from a four to a 40%uplift in approval rates, uh,
(11:00):
depending on the NCC, thescenario, the transaction type.
I would say that in our ownportfolio, we're actually seeing
even more positive results thansome of the industry
publications are quoting.
SPEAKER_02 (11:10):
Okay.
So the next value thattokenization brings is optimized
interchange rates.
So, Mark, can you start theconversation there?
Sure.
SPEAKER_03 (11:20):
I mean, so the easy thing we're at the surface is
some of the networks areactually providing a discounted
interchange rate for using anetwork token versus a
credential that is not a networktoken.
So that's right off the top, isthe easiest thing to point to.
But there's also create anopportunity here for payment
orchestrators or optimizers.
Uh, and this can be it's a statealone company or it can be a
(11:40):
service provided by a companylike NMI that provides merchants
that ability to sort of leveragethe token to make sure that they
are getting the best possibleinterchange rate at that moment
in time for that transaction forthat consumer and leveraging
that information correctly.
So that's that's this worseningon our end.
SPEAKER_02 (11:59):
And Ryan, I don't know, being that you're you're
one of those companies whodecides some of those
interchange rates, if you haveany thoughts there.
SPEAKER_00 (12:07):
Yeah, I mean, I guess when you know rent
authorizations improve and andand declines drop, you know,
interchange dynamic dynamics andprocessing efficiency improve
too, right?
So uh, you know, fewer costsfrom lost revenue and and
declines in in re you know,having to reprocess
transactions.
So uh, you know, I think it's uhan important capability.
SPEAKER_02 (12:27):
Yeah, I think the next one is is kind of a big one
because you know, I continue tohear in conversations that I
have around fraud andchargebacks, obviously part of
that.
But I think the the fraud, thefraudsters are getting smarter
and better every day.
And and if this is a way thatcan help with that, I think
that's huge.
So, Mark, any any initialthoughts on that one?
SPEAKER_03 (12:47):
I think we've touched on this a little bit
already, but going back to thecertainty of understanding who
this person is and where thatcredential came from, it is a
very, very big factor here.
Uh mentioned earlier that ifthis credential is somehow
stolen or compromised, thatreally the utilization of that
token can't really be usedanywhere, right?
You can't take a token fromMerchant ABC and try to use it
(13:09):
at Merchant XYZ, it's it's notgonna work.
As some of these servicescontinue to evolve, we're gonna
start seeing more and more of adevice-bound token, right?
So, so if this token is used onmy PC, it can't be used on a
fraudster's phone, right?
So this is further enablingthat.
Whereas if they just had mysimple payment credentials or
(13:31):
even potentially a non-networktoken, those capabilities might
allow more fraud to happen.
I think part of chargebacks isalso something that's uh maybe a
little bit more of apsychological element for
consumers.
Life cycle management plays intothis.
If a merchant has an up-to-dateuh credential for me as a
consumer, they don't miss apayment, they don't miss a
(13:54):
month, or I don't miss a paymenton a monthly recurring
transaction, preventing thechange where three months from
now they finally get an updatedcredential, and now I have a
large transaction coming throughfrom this recurring
subscription.
I may challenge that as achargeback as a consumer because
I didn't notice that the twopast two months weren't even
charged to me, right?
So I think this is fraudulent onbehalf of the merchant.
(14:15):
I'm challenging it as achargeback.
And basically it's creating awhole lot of work for a whole
lot of people that's notnecessary where if you have that
current credential all the time,I'm accustomed to seeing that$15
a month charge.
So it's that it doesn't throw meoff when all of a sudden it's$65
because there's been multiplemonths being charged at the same
time.
So that's some of the simpleapplications of it, I think.
SPEAKER_01 (14:35):
Yeah, and I think from an issuer perspective, when
they see a transaction thatcomes through that has a 3DS
cryptogram or a network tokencryptogram, they know more about
it.
They know that that card wastied to a device, um, like Mark
talked about.
And they're less likely, I mean,issuers have auto-charbeback
rules and they they take a lookat some of these um transaction
types with additional detail andthey'll be more discerning about
(14:56):
what goes through the autochargeback process.
And that has ripple effects.
And just a story about one ofour customers at NMI who uses
network tokens, they are apartner, they specialize in
subscription services and theywork with merchants ranging from
very high-end exclusiverestaurants to yacht clubs to
alumni student groups to men'sclothing.
(15:18):
Like they're they're across theboard in terms of the
direct-to-consumer merchantsthat are using their
subscription services.
And since working with NMI andimplementing our products called
Customer Token Vault, because itjoins our Gateway token and our
network token together.
This partner of ours has seen a28% increase in approval rates
and their blended interchangecost across the networks is
(15:40):
saving about seven to eightbasis points.
And they're seeing a reductionin fraud and and chargebacks
that are coming across.
So it's just it's kind of hitthe big core benefits in this
use case.
And especially in thisenvironment where we see an
uptick in AI fraud.
I think AI is growing all aroundus, and we see an uptick in
restrictions, things like thevisa program that are creating
(16:03):
higher thresholds or what wehave to hit in terms of you know
dispute rates and fraud rates.
Network tokens is really animportant tool for merchants to
have in their belt to be able toget ahead of those constraints.
SPEAKER_00 (16:15):
Yeah, I agree.
I mean, Tiffany, Mark, you touchon great, great points that,
right?
And you both make the point thatthe tokens are essentially
cryptographically tied to eithera device or they have a lot more
context to them as well, right?
So, you know, for an issuer, youknow, the aspects of the token
are the data elements thatobviously flow to them, right?
(16:35):
So they get a lot more contexton the transaction, you know, be
it being tied to a specificmerchant or even in the case of
AI that you're referencingthere, Tiffany, you know, we're
we're kind of moving to alsobeing able to explain to the
issuer who the agent wasinvolved in in this transaction,
right?
So I think um, you know,tokenization really does you
(16:56):
know provide uh uh not just asecurity around the credential
itself, but the the context ofthe transaction, which I think
is really important, andespecially when you're you know
combining that withauthentication and
authentication tools, you know,so being able to you know tie
that credential with someone'sidentity, um, you know, that's
that's a really major reductionin risk for an issuer.
SPEAKER_02 (17:18):
Okay.
And the next one, and I I think,you know, Mark, you and Tiffany
kind of mentioned this a littlebit, but you know, the recurring
payments space, so making thosepayments smoother and easier.
So, Mark, you want to talk tothat for a minute?
SPEAKER_03 (17:31):
I think we all probably have experienced this a
little bit recently, but heturned back the clock a decade
ago.
We all received a couple ofemails a month asking us to
update our credentials, right?
For any type of subscriptionservice we had, or even it's
just a an online merchant thatwe use with any frequency.
And those have they're not theydon't not exist at all anymore,
but the frequency at which wereceive them is very minimal.
So what is happening is we'regetting these automatic
(17:54):
lifecycle managementnotifications for our
credentials.
So if my card is just expired orlost or stolen, whatever the
case might be, I as a consumerno longer need to go into each
one of my subscription services,which is growing every year, by
the way, of the number ofsubscriptions that we all have,
to update my credentials.
So for a couple scenarios there,right?
(18:15):
So that used to be a path bywhich people ended their
subscriptions, right?
I'm not gonna give that companymy new expiration date.
So therefore my subscriptionwill ultimately end.
So this for a merchant sitsthere and says, well, we're not
gonna lose retention, which Iknow is a big part of their
business models simply becausewe don't have an updated
credential.
(18:35):
Also, in the past, merchantswere facing somewhere between,
depending on which statisticsyou read, they were from$20 to
$70 of cost just to get anupdated credential for a
customer.
So this is something that'shappening automatically.
They don't notice that ithappens as far as merchant is
concerned, and and it's businessas usual.
So I think this is really, frommy perspective, a place where
(18:56):
network tokens really shine,because this is something that
was a true pain point beforethat is sort of disappearing day
by day.
SPEAKER_00 (19:04):
Yeah, I think, I think, I think you're right
there, Mark.
You know, I I've I've I mean Icertainly noticed this when I'm
you know talking to merchantsabout you know enabling network
tokens, that um I always kind oflook at it from the perspective
of the consumer and the userexperience that that they get in
a result of a declinetransaction.
You know, a decline transactionthat didn't necessarily have to
happen because there are updatedcredentials available if if that
(19:28):
if they were using you knowtokenization.
So um, you know, and whilst youknow there's obviously always
the opportunity for thatconsumer to enter another
credential or another paymentmethod, it did result in a bad
experience, right, for thatconsumer.
So that consumer then has theoptionality and you know they
they know they've had that badexperience and maybe they they
(19:48):
go elsewhere.
So um, you know, I thinkremoving those friction points
is is a is a really you knowgreat benefit to network
tokenization.
SPEAKER_02 (19:56):
And then the last one that we're gonna touch on
kind of the value of networktokenization, and and Mark
mentioned it a little bitalready, the stronger customer
retention, being able to keepthose customers longer.
So, Mark, any other thoughts onthat one?
SPEAKER_03 (20:10):
No, yeah, just reiterating, I think, what
everyone's been saying, I mean,it it's a better experience,
right?
I don't have complications.
Uh, I may be trying to run atransaction though and I'm
running out the door to go pickmy daughter at field hockey or
something along those lines.
And I don't have time to enterin new payment credentials.
I don't have time to updatesomething.
(20:30):
And whether that is just aninconvenience for me or a lost
transaction for the merchantbecause I never remember to go
back to do that, or it's justmore simple to get that same
product from another merchantwho isn't going to have that
hurdle there for me because uhit's entered my credentials more
recently.
You know, in this scenario,lifecycle management, higher
authorization rates, which we'veall been mentioning, which is
(20:51):
just a cleaner, faster, moreconvenient experience.
I'm gonna enjoy my experienceand I'm more likely to come back
and spend more money with thatsame merchant.
So I think it's uh it's it's aculmination of all the different
points we've been talking aboutto this point.
SPEAKER_01 (21:06):
Agree.
And you know, the subscriptioneconomy is massive and it's
growing.
And I read a stat a few monthsago from payments.com that said
a third of subscriptionconsumers, when when a merchant
churns subscription consumers, athird of it's because of payment
interruption issues.
Because, like Mark said, ifyou're sitting on the couch on a
Friday night and your Huluaccount doesn't renew, you just
(21:28):
go to Netflix, right?
It it's so convenient.
There's so much competition outthere, you just go to where your
payment is is adopted.
And talking about kind of thatthat evolution of, you know, a
decade ago, you used to have togo in and remember every time
you reported your your credit ordebit card loss stolen.
You had to remember all theplaces it was on the file and go
in and re-key it.
(21:48):
And then the next evolution wasthis account updater concept,
which was great and novel and itwas automatic, but it was all on
batch.
You know, the issuer would maybetake a couple of weeks or a
couple of months to update thenew card credential to the
network.
And then the merchant would takea couple of weeks or a couple of
months to download it to updatethe credential on file.
And that all gets, which wasgreat, and there's great
(22:10):
evolution, but that all getscompletely irreal time now with
lifecycle management, where whenyou go to your bank and say my
card's lost stolen, Netflix nowhas your card credential within
minutes because of thatlifecycle management update,
which in a world wheresubscription economy, a third of
their business is walking outthe door because of payment
interruption, this lifecyclemanagement, I think it will be
(22:33):
really, really helpful.
And of course, that's on top ofthe higher approvals, the fewer
declines, the betterchargebacks.
Um, but that uninterruptedrecurring billing, I think, is
really key to the value prop andthe customer retention here.
SPEAKER_02 (22:45):
Okay, so Tiffany, I'm gonna stick with you for
this next question.
What do you think the future oftokenization looks like?
SPEAKER_01 (22:52):
So I have three predictions for network tokens.
Um, first, I think it becomesthe default for card not
present, you know, because oflifecycle updates and the value,
I think it becomes even morepervasive.
I think secondly, the idea oftokenization will move beyond
cards.
We'll start to see it more inopen banking, the account to
account, um, other alternativepayment methods.
(23:15):
And then thirdly, with the worldof AI exploding around us, I
think tokens will be leveragedto predict declines, do low-cost
routing, fight fraud.
Um, so I think, especially inthe world of agentic commerce,
you know, at its emphasis, Ithink tokenization just at the
beginning.
SPEAKER_02 (23:34):
Okay.
Ryan, any thoughts?
SPEAKER_00 (23:36):
Yeah, absolutely.
I guess I'll follow on from thattheme that Tiffany raised around
agentic commerce.
I think I think that really isthe next frontier for for
tokens.
Um, you know, I think we'rewe're already in a world where
we're seeing over half of uh USconsumers moving from
traditional search engines toyou know to leverage Gen AI to
(23:57):
support their shopping needs.
So um, you know, I think thatthe tokens are obviously going
to be key here, right?
You know, where you know agentsare acting on behalf of
consumers and and businesses toexecute transactions, you know,
they're gonna need to be secure,right?
They're gonna need to betrusted.
You know, really in a worldwhere you can imagine your own
sort of a system, your owndigital system, maybe booking
(24:18):
your travel or um you knowpaying a bill or renewing a
license for you.
There's there's real you know,real kind of you know boundaries
that you have to define there tokind of ensure that there's
trust in the ecosystem in thosethose user experiences.
And I think that's really wheretokenization becomes you know
critical.
You know, obviously, as we'vebeen talking about, it takes you
(24:40):
know the sensitive accountinformation and and um makes
sure that it can be used safelyacross uh you know any device,
any any channel, any ecosystem.
And that's really where you knowtokens has become the foundation
for agentic, you know, agenticcommerce.
And you know, when you'recombining that with things like
you know, agent registration orbiometric authentication and
(25:02):
those kind of conversationalinterfaces that come with with
Gen AI, that's you know, that'sreally where I think we'll see
the the power of this thiscapability come to come to life.
You know, and I think you know,MasterCard's role is going to be
really important in that interms of making sure that that
where the world is becoming moreautonomous, you know, trust has
to travel with with everytransaction there as well.
(25:23):
So um, you know, whether that'sinitiated by a person or a
device or uh an agent, you know,tokenization has really laid
laid the rails for this nextwave of uh of of commerce.
SPEAKER_02 (25:35):
Okay.
Mark, any thoughts on thefeature?
SPEAKER_03 (25:37):
Uh both Tiffany and Ryan you know covered that very,
very uh thoroughly.
I think the only addition Iwould have is I think we have
this this other great additionaltool, pass keys.
And I think you'll start seeingmore examples of tokens and pass
keys being used together, uh,whether that be once again about
using uh asynchronous orsynchronous devices, right?
So sort of depending on kind ofmerchant or or or how much
(25:58):
you're using in those cases, uh,the really kind of further
leverage the knowledge that thisperson is who they say they are.
And I think you'll start seeingmore combinations of those.
Uh, I think super long term,you're gonna start seeing like
ID tokens, right?
And that will also probably besomething that is combined with
the use of the network tokenbecause you're leveraging, once
(26:18):
again, who this person is, thethe uh authority or mandate that
they give in an agentic AItransaction to actually provide
payment in this scenario.
And and those are all going toget tied together and kind of
have a central sort of meetingpoint, I believe.
But uh that's but otherwisecovered very thoroughly.
SPEAKER_02 (26:37):
Okay, great.
So, Tiffany, can you tell us alittle bit about the
relationship between GD and NMI?
SPEAKER_01 (26:44):
So, Mark mentioned in his intro, you know, GD is a
longtime leader in tokenizationand digital payment enablement.
So they specialize in everythingfrom token provisioning,
lifecycle management, digitalassurances, like pass keys, like
you just mentioned.
And there's a lot of subjectmatter expertise that comes with
that.
And then at NMI, we have builtall of those network token
benefits we've talked about, theyou know, the lower fraud rates,
(27:07):
the less friction, the lifecyclemanagement.
We make network tokens availableto our channel or ecosystem of
partnerships without additionalintegrations or development.
So I would say together, GD andNMI, we really complement each
other.
And um, we help our networkadopt tokens very quickly,
securely at enterprise scalewith just a simple configuration
(27:27):
because we've done the heavylifting that all taps into the
great network work thatMasterCard and the other
networks have done from a tokenservice perspective.
SPEAKER_02 (27:35):
Okay, great.
So, one last question for thethree of you.
And Ryan, I'm gonna start withyou.
What is the one takeaway you'dlike the listeners to come away
with from this conversation whenit comes to network
tokenization?
SPEAKER_00 (27:48):
Yeah, I I think from my perspective, it's just kind
of understanding that networktokenization isn't really just a
security upgrade.
Um, you know, it's thefoundation for really the next
generation of digital commerce.
You know, tokens really enablesafer, smoother, smarter
interactions.
And so, you know, when you layerthat with new technologies or
(28:10):
capabilities like agenticcommerce, payments become so
seamless because they use thesetokens, right?
They recede into the background.
And you know, merchants andconsumers can then focus on the
value that they're getting fromthese transactions versus you
know any friction that mightmight be there.
Um, so yeah, that that's my maintakeaway and you know, proud to
be you know leading thattransformation and very excited
(28:31):
about what comes next.
SPEAKER_02 (28:33):
Okay, so Tiffany, over to you.
What's the what's the onetakeaway you want the listeners
to come away with from thisshow?
SPEAKER_01 (28:39):
Um at the end of the day, payments, they're not just
a back office function.
It's a critical part of thecustomer experience.
And network tokens, it mightseem scary and complicated and
cryptograms.
And don't be afraid orintimidated.
You have great partners to leanon, like GND and NMI and
MasterCard that have done a lotof heavy lifting to make it
seamless for our partners andour merchants.
(29:00):
So don't be intimidated and justrealize that network tokens are
it's not just a securityfeature, it's a business lever.
SPEAKER_03 (29:06):
Okay.
Mark, your your thoughts.
Yeah again, uh Ryan Tiffany uhcovered uh almost the bases
there.
I think the only thing I wouldsay is, you know, tokenization
in general, existence for 20plus years, right?
Network tokens for the past 10years, adoption is happening
very rapidly right now.
It's not a finished product.
Yeah, don't know that it everwill be, right?
So I think it's it's afoundational layer, like Ryan
(29:28):
was mentioning, that that can bebuilt upon, where there will be
more and greater features andmore ways to utilize it.
So participating in it andgetting it as part of your uh
operating system makes youprepared for the next great
feature that will be used to usenetwork tokens on that might
include other types of expresspayment options and things of
(29:48):
that nature.
So it's it's something that'simportant for uh merchants and
processors to get on board withbecause it's going to be sort of
what the future is built upon.
SPEAKER_02 (29:56):
Okay.
I think that's a great way towrap up the show.
So, Mark, Tiffany, Ryan.
Ryan, thank you so much forbeing on the show today.
I know your time is veryvaluable, so I really appreciate
you being here.
SPEAKER_00 (30:04):
Thanks, Greg.
SPEAKER_01 (30:06):
Thanks for having us.
Great conversation.
SPEAKER_02 (30:07):
Thank you.
Good to see everybody again.
And to all you listeners outthere, I thank you for your time
as well.
And until the next story.
Welcome to the Signal, powered by the Leaders
in Payments Podcast, where weare cutting through the noise to
reveal what truly matters inpayments and fintech.
SPEAKER_02 (00:13):
Hello, everyone, and welcome to the Leaders in
Payments Podcast.
I'm your host, Greg Myers, andtoday's special guests are Mark
Van Horn, the Digital SolutionLead North America at GND,
Tiffany Johnson, the ChiefProduct Officer at NMI, and Ryan
Francis, Vice President DigitalProduct at MasterCard.
So, Mark, Tiffany, Ryan, thankyou all for being here and
welcome to the show.
(00:34):
Thanks for having us.
Happy to be here.
So this episode is part of oursignal series where we're
cutting through the noise toreveal what truly matters in
payments and fintech.
Network tokens aren't just aboutreplacing pans, they're about
unlocking value across thepayments ecosystem.
So for software companies andISVs, they can provide
tremendous value.
(00:54):
And we're going to unpack justthat in this episode.
So, Mark, before we dive intothe meat of the conversation,
can you walk us through yourprofessional journey?
Tell us a little bit about whatGD does, especially as it
relates to network tokenization.
SPEAKER_03 (01:07):
Sure.
Yeah.
My payment journey startedprobably in the late 90s.
Worked for a company that had atransaction tracking program for
not-for-profit organizations.
That has eventually led me towhere I am today.
For the past four years, I'vebeen leading the uh digital
growth and enablement for GDhere in North America.
GD has done a great job over the170 years of its existence,
(01:30):
being a quiet player in thebackground.
But we do everything from uh simchips to uh creating currency to
uh being the third largestproducer of debit and credit
cards in the world.
So my team sits on the digitalsoftware that surrounds the use
of those cards, and thatincludes network tokenization.
So if a card on file, we helpaggregate the services from
MasterCard and the othernetworks to provide a single uh
(01:51):
implementation for our customersto utilize network tokens.
SPEAKER_02 (01:55):
Okay.
Tiffany, same question for you.
Can you walk us through yourprofessional journey and tell us
a little about NMI andespecially as it relates to
network tokenization?
SPEAKER_01 (02:03):
Of course.
So as you said, I am the chiefproduct officer for NMI.
I've been here about two and ahalf years.
I've been in payments for goingon 20 years.
And the whole journey, myprimary focus has been around
embedded platform payments.
And I'd say throughout mycareer, I've had the privilege
of working with incrediblecustomers and companies,
everyone from Apple and Uber tointo Amazon.
(02:24):
Even at one point, I helpedembed payments into Formula One.
So have a lot of experience inembedded payment strategies and
payments platforms.
And then a bit about NMI.
NMI is a global paymentsplatform.
We serve about 4,000 channelpartners.
So PayPax, ISOs, banks, ISVs,Sense platforms.
And through those channelpartners, they provide payment
(02:46):
services to over a million smalland medium-sized and in some
cases enterprise businesses aswell that are using our platform
to process payments as they selltheir goods and services.
So our mission at NMI is todeliver that full service
payments acceptance platform forour partners.
And it's fully white labeled.
So you may not have heard of us,but you've probably processed
(03:06):
transactions through us.
And as part of that vision, wethink network tokens are
critical to the acceptancejourney because of the lift it
creates and approvals, friction,everything that's important to
that payments journey.
And obviously, we'll be divingin today.
So thanks for having me.
SPEAKER_02 (03:22):
Absolutely.
So, Ryan, your turn, samequestion for you.
Can you walk us through yourprofessional journey?
Tell us a little bit about whatMasterCard does, especially as
it relates to networktokenization.
SPEAKER_00 (03:32):
Thanks, Greg.
Um, it's great, great to behere.
So, yeah, I basically the vicepresident of Digital Product for
North America at MasterCard.
I have over uh 22 years of ofpayments experience
predominantly on acceptance andsupporting acquirers and payment
service providers.
But uh my focus right now is isreally on building the next
(03:54):
generation of digital commerceexperiences.
So my team is really focused onmaking sure that payments remain
seamless, secure, andintelligent.
You know, from a MasterCardpoint of view, I mean, we've
obviously very much led the wayin terms of network
tokenization.
And really since their inceptionover you know 10 years ago now,
you know, we've continued toevolve the capabilities of
(04:18):
digital tokens.
And so continuing the work thatI've done over those years,
really, in terms of you knowworking with our acceptance
partners and issuing partners toscale our tokenization
footprint.
You know, we've got to a pointreally where more than 30% now
of MasterCard transactionsglobally are using um NDES and
tokenized Rails.
(04:39):
And that's even greater.
I mean, in in North America,it's around 50% now.
So, you know, tokenization hasreally been the foundation of uh
a lot of the uh the innovationand digital use cases that we've
come to see in uh come tofruition in recent years.
SPEAKER_02 (04:54):
Okay, great.
So let's dive into the topic fortoday's conversation, obviously,
network tokenization.
So, Mark, let's start with you.
Can you define generaltokenization and then tell us
maybe what the difference isbetween general tokenization and
network tokenization?
SPEAKER_03 (05:10):
Yeah, very simply put, uh, turning back the clock
to the early days of onlinetransactions and the internet
and e-commerce, and merchantsstarted storing PANS and payment
credentials for their customers,for repeat customers.
This was obviously highlysusceptible to fraud and and
breaches and things of thatnature.
So some smart people came upwith tokenization.
(05:31):
And this is basically the ideaof taking sensitive information
and turning it into anon-sensitive equivalent, right?
So this token is useless outsidethe realm of working with that
merchant.
Uh so if you steal a token, itto you can't really use it
anywhere.
This has really helped protectmerchants to have a lower
susceptibility to fraud.
But as it has evolved, it'sbecome necessary.
(05:53):
And Ryan and his team and hisequivalents have realized that
there's a real role there fornetworks to participate in this.
So the first iteration did agreat job of getting the
responsibility out of themerchants' hands, but that
responsibility then fell oncompanies like NMI to protect
that data.
In the newest version, we havethe actual tokens being
generated by the networks.
(06:14):
So Visa, MasterCard, AmexDiscover here at U in the US
primarily.
They in turn also have to beapproved by the issuing bank.
So those tokens have a furtherand greater degree of approval
and uh tied identity to thosecredentials for that specific
merchant.
So yeah, it's been a prettygreat evolution.
SPEAKER_02 (06:33):
So okay.
Well, Ryan, I'd love to get yourperspective on network
tokenization, especially kind ofas it relates to the broader
industry landscape and kind ofwhat's going on in that world
today.
SPEAKER_00 (06:46):
Yeah, thanks, Greg.
I think from my vantage point,um, yeah, what's really
compelling about networktokenization is how it's really
shifted from being a securitycontrol to a more broader
strategic growth enabler for theentire payments ecosystem.
So, I mean, you know, if youtake where we are today, network
tokenization is really becomingtable states.
(07:08):
You know, merchants usingnetwork tokens are typically
seeing anywhere uh in the regionof between three to six
percentage points ofauthorization uplift.
Um and that's really ameaningful difference, right?
You know, especially when youthink about the hundreds of
millions of transactions thatare being processed each day.
You know, and that and that'sreally not you know just because
uh you know tokenization is isjust swapping out a card number,
(07:30):
right?
It's you know, it's some verycritical trends and capabilities
around network tokenizationthat's driving that adoption and
that and that um capability.
So I think you know, three thatI can think of really around you
know lifecycle management beinga big part of network
tokenization.
You know, tokens obviouslyautomatically update when a card
is reissued or credentialschange, which you know really
(07:53):
helps cut down on unnecessarydeclines and and you know leads
to a better consumer experienceoverall.
And I think you know, obviously,with the help of partners like
NMI and uh GD, you know, we'vereally got to a point of
interoperability and scale.
You know, tokenization is nolonger really just scaled into
one wallet or one merchant.
(08:13):
You know, there's really acollaboration across across
networks, you know, issuers,gateways, merchants, and you
know, everyone's really workingtogether now in terms of you
know being able to use thosecapabilities.
And then that's reallyimportant, right?
You know, especially as we'reyou know entering a world where
you know payments become moreembedded, you know, more
intelligent.
And you know, we're we're gonnawe're getting to a point, I
(08:35):
guess, where you know thingslike agents are starting to act
on behalf of consumers andmerchants, right?
So, you know, tokens really doprovide uh the the ability for
merchants and issuers to makesure that they gain insights and
trust as part of the inbuiltcapability of the token itself.
So, yeah, uh, you know, I thinkas an industry we've really been
raising the bar on what tokenscan do.
(08:56):
And it's not really just aboutprocessing transactions, but
really helping drive, you know,drive business outcomes.
So higher conversion, strongerretention, less fraud, and
eventually becoming you knowinvisible infrastructure for
commerce as a whole.
SPEAKER_02 (09:10):
Okay, I think that's a great segue into the next
question, which I really want tobe a group discussion.
So, Mark, I'm gonna point thequestion at you, but Tiffany,
Ryan, please, please jump in.
And what we're gonna do is kindof break down the value of
tokenization into five areas.
So let's walk through each ofthose and have you give us your
(09:30):
thoughts.
So the first one is higherauthorate.
So, Mark, thoughts on that one?
SPEAKER_03 (09:37):
I think by its nature, a network token provides
a greater degree of certaintyfrom all the players
participating in thetransaction.
This is a credential that hasbeen pre-designated by the
issuer as an authentic token.
And therefore, when it issubmitted for a transaction and
it is tied to a specificmerchant using a certain domain,
right?
(09:57):
You can't use that network tokenif it's an e-commerce token to
then do some type of point ofsale or something along those
lines.
So you're creating a scenariowhere everyone who's
participating uh has seen thisbefore, recognizes it,
understands the format thatwhich being used, and therefore
creates a higher level ofauthorization rates.
Ryan uh mentioned some of thoserates, and and those are pretty
(10:20):
significant already.
Uh, we have some single usecases with certain specific
merchants that are evendramatically more high than that
authorization rate.
So it it's a it's a path bywhich these network tokens
really provide a real advantageover just using regular optimum
credentials.
SPEAKER_01 (10:37):
I would agree with that because of those benefits,
you know, and in MasterCardVisa, JP Morgan, there's a lot
of studies out there wherepeople quote, you know, a three
to four percent uplift inauthorization on top of
meaningful reduction in onlinefraud.
But I will say within our NOIportfolio with the partners that
have enabled networktokenization, we're seeing
anywhere from a four to a 40%uplift in approval rates, uh,
(11:00):
depending on the NCC, thescenario, the transaction type.
I would say that in our ownportfolio, we're actually seeing
even more positive results thansome of the industry
publications are quoting.
SPEAKER_02 (11:10):
Okay.
So the next value thattokenization brings is optimized
interchange rates.
So, Mark, can you start theconversation there?
Sure.
SPEAKER_03 (11:20):
I mean, so the easy thing we're at the surface is
some of the networks areactually providing a discounted
interchange rate for using anetwork token versus a
credential that is not a networktoken.
So that's right off the top, isthe easiest thing to point to.
But there's also create anopportunity here for payment
orchestrators or optimizers.
Uh, and this can be it's a statealone company or it can be a
(11:40):
service provided by a companylike NMI that provides merchants
that ability to sort of leveragethe token to make sure that they
are getting the best possibleinterchange rate at that moment
in time for that transaction forthat consumer and leveraging
that information correctly.
So that's that's this worseningon our end.
SPEAKER_02 (11:59):
And Ryan, I don't know, being that you're you're
one of those companies whodecides some of those
interchange rates, if you haveany thoughts there.
SPEAKER_00 (12:07):
Yeah, I mean, I guess when you know rent
authorizations improve and andand declines drop, you know,
interchange dynamic dynamics andprocessing efficiency improve
too, right?
So uh, you know, fewer costsfrom lost revenue and and
declines in in re you know,having to reprocess
transactions.
So uh, you know, I think it's uhan important capability.
SPEAKER_02 (12:27):
Yeah, I think the next one is is kind of a big one
because you know, I continue tohear in conversations that I
have around fraud andchargebacks, obviously part of
that.
But I think the the fraud, thefraudsters are getting smarter
and better every day.
And and if this is a way thatcan help with that, I think
that's huge.
So, Mark, any any initialthoughts on that one?
SPEAKER_03 (12:47):
I think we've touched on this a little bit
already, but going back to thecertainty of understanding who
this person is and where thatcredential came from, it is a
very, very big factor here.
Uh mentioned earlier that ifthis credential is somehow
stolen or compromised, thatreally the utilization of that
token can't really be usedanywhere, right?
You can't take a token fromMerchant ABC and try to use it
(13:09):
at Merchant XYZ, it's it's notgonna work.
As some of these servicescontinue to evolve, we're gonna
start seeing more and more of adevice-bound token, right?
So, so if this token is used onmy PC, it can't be used on a
fraudster's phone, right?
So this is further enablingthat.
Whereas if they just had mysimple payment credentials or
(13:31):
even potentially a non-networktoken, those capabilities might
allow more fraud to happen.
I think part of chargebacks isalso something that's uh maybe a
little bit more of apsychological element for
consumers.
Life cycle management plays intothis.
If a merchant has an up-to-dateuh credential for me as a
consumer, they don't miss apayment, they don't miss a
(13:54):
month, or I don't miss a paymenton a monthly recurring
transaction, preventing thechange where three months from
now they finally get an updatedcredential, and now I have a
large transaction coming throughfrom this recurring
subscription.
I may challenge that as achargeback as a consumer because
I didn't notice that the twopast two months weren't even
charged to me, right?
So I think this is fraudulent onbehalf of the merchant.
(14:15):
I'm challenging it as achargeback.
And basically it's creating awhole lot of work for a whole
lot of people that's notnecessary where if you have that
current credential all the time,I'm accustomed to seeing that$15
a month charge.
So it's that it doesn't throw meoff when all of a sudden it's$65
because there's been multiplemonths being charged at the same
time.
So that's some of the simpleapplications of it, I think.
SPEAKER_01 (14:35):
Yeah, and I think from an issuer perspective, when
they see a transaction thatcomes through that has a 3DS
cryptogram or a network tokencryptogram, they know more about
it.
They know that that card wastied to a device, um, like Mark
talked about.
And they're less likely, I mean,issuers have auto-charbeback
rules and they they take a lookat some of these um transaction
types with additional detail andthey'll be more discerning about
(14:56):
what goes through the autochargeback process.
And that has ripple effects.
And just a story about one ofour customers at NMI who uses
network tokens, they are apartner, they specialize in
subscription services and theywork with merchants ranging from
very high-end exclusiverestaurants to yacht clubs to
alumni student groups to men'sclothing.
(15:18):
Like they're they're across theboard in terms of the
direct-to-consumer merchantsthat are using their
subscription services.
And since working with NMI andimplementing our products called
Customer Token Vault, because itjoins our Gateway token and our
network token together.
This partner of ours has seen a28% increase in approval rates
and their blended interchangecost across the networks is
(15:40):
saving about seven to eightbasis points.
And they're seeing a reductionin fraud and and chargebacks
that are coming across.
So it's just it's kind of hitthe big core benefits in this
use case.
And especially in thisenvironment where we see an
uptick in AI fraud.
I think AI is growing all aroundus, and we see an uptick in
restrictions, things like thevisa program that are creating
(16:03):
higher thresholds or what wehave to hit in terms of you know
dispute rates and fraud rates.
Network tokens is really animportant tool for merchants to
have in their belt to be able toget ahead of those constraints.
SPEAKER_00 (16:15):
Yeah, I agree.
I mean, Tiffany, Mark, you touchon great, great points that,
right?
And you both make the point thatthe tokens are essentially
cryptographically tied to eithera device or they have a lot more
context to them as well, right?
So, you know, for an issuer, youknow, the aspects of the token
are the data elements thatobviously flow to them, right?
(16:35):
So they get a lot more contexton the transaction, you know, be
it being tied to a specificmerchant or even in the case of
AI that you're referencingthere, Tiffany, you know, we're
we're kind of moving to alsobeing able to explain to the
issuer who the agent wasinvolved in in this transaction,
right?
So I think um, you know,tokenization really does you
(16:56):
know provide uh uh not just asecurity around the credential
itself, but the the context ofthe transaction, which I think
is really important, andespecially when you're you know
combining that withauthentication and
authentication tools, you know,so being able to you know tie
that credential with someone'sidentity, um, you know, that's
that's a really major reductionin risk for an issuer.
SPEAKER_02 (17:18):
Okay.
And the next one, and I I think,you know, Mark, you and Tiffany
kind of mentioned this a littlebit, but you know, the recurring
payments space, so making thosepayments smoother and easier.
So, Mark, you want to talk tothat for a minute?
SPEAKER_03 (17:31):
I think we all probably have experienced this a
little bit recently, but heturned back the clock a decade
ago.
We all received a couple ofemails a month asking us to
update our credentials, right?
For any type of subscriptionservice we had, or even it's
just a an online merchant thatwe use with any frequency.
And those have they're not theydon't not exist at all anymore,
but the frequency at which wereceive them is very minimal.
So what is happening is we'regetting these automatic
(17:54):
lifecycle managementnotifications for our
credentials.
So if my card is just expired orlost or stolen, whatever the
case might be, I as a consumerno longer need to go into each
one of my subscription services,which is growing every year, by
the way, of the number ofsubscriptions that we all have,
to update my credentials.
So for a couple scenarios there,right?
(18:15):
So that used to be a path bywhich people ended their
subscriptions, right?
I'm not gonna give that companymy new expiration date.
So therefore my subscriptionwill ultimately end.
So this for a merchant sitsthere and says, well, we're not
gonna lose retention, which Iknow is a big part of their
business models simply becausewe don't have an updated
credential.
(18:35):
Also, in the past, merchantswere facing somewhere between,
depending on which statisticsyou read, they were from$20 to
$70 of cost just to get anupdated credential for a
customer.
So this is something that'shappening automatically.
They don't notice that ithappens as far as merchant is
concerned, and and it's businessas usual.
So I think this is really, frommy perspective, a place where
(18:56):
network tokens really shine,because this is something that
was a true pain point beforethat is sort of disappearing day
by day.
SPEAKER_00 (19:04):
Yeah, I think, I think, I think you're right
there, Mark.
You know, I I've I've I mean Icertainly noticed this when I'm
you know talking to merchantsabout you know enabling network
tokens, that um I always kind oflook at it from the perspective
of the consumer and the userexperience that that they get in
a result of a declinetransaction.
You know, a decline transactionthat didn't necessarily have to
happen because there are updatedcredentials available if if that
(19:28):
if they were using you knowtokenization.
So um, you know, and whilst youknow there's obviously always
the opportunity for thatconsumer to enter another
credential or another paymentmethod, it did result in a bad
experience, right, for thatconsumer.
So that consumer then has theoptionality and you know they
they know they've had that badexperience and maybe they they
(19:48):
go elsewhere.
So um, you know, I thinkremoving those friction points
is is a is a really you knowgreat benefit to network
tokenization.
SPEAKER_02 (19:56):
And then the last one that we're gonna touch on
kind of the value of networktokenization, and and Mark
mentioned it a little bitalready, the stronger customer
retention, being able to keepthose customers longer.
So, Mark, any other thoughts onthat one?
SPEAKER_03 (20:10):
No, yeah, just reiterating, I think, what
everyone's been saying, I mean,it it's a better experience,
right?
I don't have complications.
Uh, I may be trying to run atransaction though and I'm
running out the door to go pickmy daughter at field hockey or
something along those lines.
And I don't have time to enterin new payment credentials.
I don't have time to updatesomething.
(20:30):
And whether that is just aninconvenience for me or a lost
transaction for the merchantbecause I never remember to go
back to do that, or it's justmore simple to get that same
product from another merchantwho isn't going to have that
hurdle there for me because uhit's entered my credentials more
recently.
You know, in this scenario,lifecycle management, higher
authorization rates, which we'veall been mentioning, which is
(20:51):
just a cleaner, faster, moreconvenient experience.
I'm gonna enjoy my experienceand I'm more likely to come back
and spend more money with thatsame merchant.
So I think it's uh it's it's aculmination of all the different
points we've been talking aboutto this point.
SPEAKER_01 (21:06):
Agree.
And you know, the subscriptioneconomy is massive and it's
growing.
And I read a stat a few monthsago from payments.com that said
a third of subscriptionconsumers, when when a merchant
churns subscription consumers, athird of it's because of payment
interruption issues.
Because, like Mark said, ifyou're sitting on the couch on a
Friday night and your Huluaccount doesn't renew, you just
(21:28):
go to Netflix, right?
It it's so convenient.
There's so much competition outthere, you just go to where your
payment is is adopted.
And talking about kind of thatthat evolution of, you know, a
decade ago, you used to have togo in and remember every time
you reported your your credit ordebit card loss stolen.
You had to remember all theplaces it was on the file and go
in and re-key it.
(21:48):
And then the next evolution wasthis account updater concept,
which was great and novel and itwas automatic, but it was all on
batch.
You know, the issuer would maybetake a couple of weeks or a
couple of months to update thenew card credential to the
network.
And then the merchant would takea couple of weeks or a couple of
months to download it to updatethe credential on file.
And that all gets, which wasgreat, and there's great
(22:10):
evolution, but that all getscompletely irreal time now with
lifecycle management, where whenyou go to your bank and say my
card's lost stolen, Netflix nowhas your card credential within
minutes because of thatlifecycle management update,
which in a world wheresubscription economy, a third of
their business is walking outthe door because of payment
interruption, this lifecyclemanagement, I think it will be
(22:33):
really, really helpful.
And of course, that's on top ofthe higher approvals, the fewer
declines, the betterchargebacks.
Um, but that uninterruptedrecurring billing, I think, is
really key to the value prop andthe customer retention here.
SPEAKER_02 (22:45):
Okay, so Tiffany, I'm gonna stick with you for
this next question.
What do you think the future oftokenization looks like?
SPEAKER_01 (22:52):
So I have three predictions for network tokens.
Um, first, I think it becomesthe default for card not
present, you know, because oflifecycle updates and the value,
I think it becomes even morepervasive.
I think secondly, the idea oftokenization will move beyond
cards.
We'll start to see it more inopen banking, the account to
account, um, other alternativepayment methods.
(23:15):
And then thirdly, with the worldof AI exploding around us, I
think tokens will be leveragedto predict declines, do low-cost
routing, fight fraud.
Um, so I think, especially inthe world of agentic commerce,
you know, at its emphasis, Ithink tokenization just at the
beginning.
SPEAKER_02 (23:34):
Okay.
Ryan, any thoughts?
SPEAKER_00 (23:36):
Yeah, absolutely.
I guess I'll follow on from thattheme that Tiffany raised around
agentic commerce.
I think I think that really isthe next frontier for for
tokens.
Um, you know, I think we'rewe're already in a world where
we're seeing over half of uh USconsumers moving from
traditional search engines toyou know to leverage Gen AI to
(23:57):
support their shopping needs.
So um, you know, I think thatthe tokens are obviously going
to be key here, right?
You know, where you know agentsare acting on behalf of
consumers and and businesses toexecute transactions, you know,
they're gonna need to be secure,right?
They're gonna need to betrusted.
You know, really in a worldwhere you can imagine your own
sort of a system, your owndigital system, maybe booking
(24:18):
your travel or um you knowpaying a bill or renewing a
license for you.
There's there's real you know,real kind of you know boundaries
that you have to define there tokind of ensure that there's
trust in the ecosystem in thosethose user experiences.
And I think that's really wheretokenization becomes you know
critical.
You know, obviously, as we'vebeen talking about, it takes you
(24:40):
know the sensitive accountinformation and and um makes
sure that it can be used safelyacross uh you know any device,
any any channel, any ecosystem.
And that's really where you knowtokens has become the foundation
for agentic, you know, agenticcommerce.
And you know, when you'recombining that with things like
you know, agent registration orbiometric authentication and
(25:02):
those kind of conversationalinterfaces that come with with
Gen AI, that's you know, that'sreally where I think we'll see
the the power of this thiscapability come to come to life.
You know, and I think you know,MasterCard's role is going to be
really important in that interms of making sure that that
where the world is becoming moreautonomous, you know, trust has
to travel with with everytransaction there as well.
(25:23):
So um, you know, whether that'sinitiated by a person or a
device or uh an agent, you know,tokenization has really laid
laid the rails for this nextwave of uh of of commerce.
SPEAKER_02 (25:35):
Okay.
Mark, any thoughts on thefeature?
SPEAKER_03 (25:37):
Uh both Tiffany and Ryan you know covered that very,
very uh thoroughly.
I think the only addition Iwould have is I think we have
this this other great additionaltool, pass keys.
And I think you'll start seeingmore examples of tokens and pass
keys being used together, uh,whether that be once again about
using uh asynchronous orsynchronous devices, right?
So sort of depending on kind ofmerchant or or or how much
(25:58):
you're using in those cases, uh,the really kind of further
leverage the knowledge that thisperson is who they say they are.
And I think you'll start seeingmore combinations of those.
Uh, I think super long term,you're gonna start seeing like
ID tokens, right?
And that will also probably besomething that is combined with
the use of the network tokenbecause you're leveraging, once
(26:18):
again, who this person is, thethe uh authority or mandate that
they give in an agentic AItransaction to actually provide
payment in this scenario.
And and those are all going toget tied together and kind of
have a central sort of meetingpoint, I believe.
But uh that's but otherwisecovered very thoroughly.
SPEAKER_02 (26:37):
Okay, great.
So, Tiffany, can you tell us alittle bit about the
relationship between GD and NMI?
SPEAKER_01 (26:44):
So, Mark mentioned in his intro, you know, GD is a
longtime leader in tokenizationand digital payment enablement.
So they specialize in everythingfrom token provisioning,
lifecycle management, digitalassurances, like pass keys, like
you just mentioned.
And there's a lot of subjectmatter expertise that comes with
that.
And then at NMI, we have builtall of those network token
benefits we've talked about, theyou know, the lower fraud rates,
(27:07):
the less friction, the lifecyclemanagement.
We make network tokens availableto our channel or ecosystem of
partnerships without additionalintegrations or development.
So I would say together, GD andNMI, we really complement each
other.
And um, we help our networkadopt tokens very quickly,
securely at enterprise scalewith just a simple configuration
(27:27):
because we've done the heavylifting that all taps into the
great network work thatMasterCard and the other
networks have done from a tokenservice perspective.
SPEAKER_02 (27:35):
Okay, great.
So, one last question for thethree of you.
And Ryan, I'm gonna start withyou.
What is the one takeaway you'dlike the listeners to come away
with from this conversation whenit comes to network
tokenization?
SPEAKER_00 (27:48):
Yeah, I I think from my perspective, it's just kind
of understanding that networktokenization isn't really just a
security upgrade.
Um, you know, it's thefoundation for really the next
generation of digital commerce.
You know, tokens really enablesafer, smoother, smarter
interactions.
And so, you know, when you layerthat with new technologies or
(28:10):
capabilities like agenticcommerce, payments become so
seamless because they use thesetokens, right?
They recede into the background.
And you know, merchants andconsumers can then focus on the
value that they're getting fromthese transactions versus you
know any friction that mightmight be there.
Um, so yeah, that that's my maintakeaway and you know, proud to
be you know leading thattransformation and very excited
(28:31):
about what comes next.
SPEAKER_02 (28:33):
Okay, so Tiffany, over to you.
What's the what's the onetakeaway you want the listeners
to come away with from thisshow?
SPEAKER_01 (28:39):
Um at the end of the day, payments, they're not just
a back office function.
It's a critical part of thecustomer experience.
And network tokens, it mightseem scary and complicated and
cryptograms.
And don't be afraid orintimidated.
You have great partners to leanon, like GND and NMI and
MasterCard that have done a lotof heavy lifting to make it
seamless for our partners andour merchants.
(29:00):
So don't be intimidated and justrealize that network tokens are
it's not just a securityfeature, it's a business lever.
SPEAKER_03 (29:06):
Okay.
Mark, your your thoughts.
Yeah again, uh Ryan Tiffany uhcovered uh almost the bases
there.
I think the only thing I wouldsay is, you know, tokenization
in general, existence for 20plus years, right?
Network tokens for the past 10years, adoption is happening
very rapidly right now.
It's not a finished product.
Yeah, don't know that it everwill be, right?
So I think it's it's afoundational layer, like Ryan
(29:28):
was mentioning, that that can bebuilt upon, where there will be
more and greater features andmore ways to utilize it.
So participating in it andgetting it as part of your uh
operating system makes youprepared for the next great
feature that will be used to usenetwork tokens on that might
include other types of expresspayment options and things of
(29:48):
that nature.
So it's it's something that'simportant for uh merchants and
processors to get on board withbecause it's going to be sort of
what the future is built upon.
SPEAKER_02 (29:56):
Okay.
I think that's a great way towrap up the show.
So, Mark, Tiffany, Ryan.
Ryan, thank you so much forbeing on the show today.
I know your time is veryvaluable, so I really appreciate
you being here.
SPEAKER_00 (30:04):
Thanks, Greg.
SPEAKER_01 (30:06):
Thanks for having us.
Great conversation.
SPEAKER_02 (30:07):
Thank you.
Good to see everybody again.
And to all you listeners outthere, I thank you for your time
as well.
And until the next story.
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