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Using Your Phone Number to Make Payments Is the Future with Tokenization and ISV Integration

Recently there has been a wave of Business to Consumer (B2C) text messaging adoption. Text messaging is becoming the customer engagement and customer service tool of choice. Consumers are more inclined to read and reply to a text message than to pick up the phone or answer an email. B2C messaging has never been more important or relevant. Combine that with the meteoric rise of digital wallets and digital banking, and the time is now for the two worlds to merge.


Payment security in the form of tokenization is not a totally new concept but it’s part of the future of freeing consumers from carrying around plastic cards. Network tokenization means a mobile phone number becomes linked to the credit card and together that secure token is stored in a vault with the ability to be used where customers shop by all major credit card brands. While a token for an arcade has no value outside of the arcade, network tokenization means that a token payment method maintains its value wherever the consumer goes next.


Network tokenization is especially important to ISVs (independent software vendors) as they look to integrated payments partners. Security, functionality and user experience are equally important to them. Here’s an idea of how it works: A customer pays by text and agrees to save their card on file. That triggers the tokenization process and that token will be associated with the customer’s phone number and the merchant they just paid. The customer needs to only do this once and everything remains connected. Now, any participating merchant is able to accept that token for payment while consumers get a text to “Use card on file” and then make their payment with a simple “Yes.”


Network card tokenization promises a world where plastic cards and manual swiping become extinct and your phone becomes your payment method.


Freeing consumers from carrying cards around has been popularized by click to pay and tap to pay at checkout terminals through the pandemic. What’s revolutionary now is the banding together of the four major card brands (Visa, Mastercard, American Express, and Discover) meaning you can have a Mastercard token and a Visa token stored in the vault and used as the preferred payment method across merchants. This allows customers to easily and safely text “Yes” to pay using their phone number.


Last year’s pandemic shook up the payments and fintech industries, prompting many software platforms to fast-track direct integration with payment gateways, thus answering the need for going contactless. Businesses started looking to their ISVs for payment processing solutions and network tokenization is the answer. Enabling consumers to pay with their phone continues to become more and more available and is the future of how everyone will pay.



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