Understanding CoFT: The Full Form and Importance for Merchant Security

With the implementation of RBI guidelines on Card Tokenisation, the term CoFT has gained significant attention. CoFT stands for Card-on-File Tokenisation. This article explores the meaning and importance of CoFT, its implications for online transactions, and how it enhances merchant security.

What is CoFT?

CoFT is a method of replacing sensitive credit and debit card information with a unique token. This token is used in online transactions, ensuring that actual card details are never exposed. This process significantly enhances the security of customer data, reducing the risk of fraud and hacking.

RBI Guidelines on CoFT

The Reserve Bank of India (RBI) issued guidelines on Card Tokenisation from 1st October 2022. According to these guidelines, merchants are no longer allowed to store card numbers, CVVs, or expiry dates for processing online transactions. This move was taken to ensure the protection of customer data and to prevent data breaches.

Implications for Merchants

Merchants must adapt to the CoFT system to comply with the new guidelines. This means that any existing card information stored by merchants will need to be deleted by 1st October 2022. Moving forward, merchants will need to use the CoFT process to securely handle customer card data.

Steps to Implement CoFT

To comply with the new guidelines and ensure secure online transactions, customers are advised to tokenize their debit and credit card information. This process involves several steps:

Visit your preferred online merchant's website or app. Choose the products or services you want to purchase. Select your CSB Bank Debit Card at checkout and enter your Debit Card details. Select ‘Securely Save/Verify your Card’ after successful authentication. Your card will be secured, and you can proceed to checkout without entering card details again.

Benefits of CoFT

Implementing CoFT offers numerous benefits for both customers and merchants:

Data Security: CoFT ensures that sensitive card information is not stored in plain text, reducing the risk of data breaches. Convenience: Customers can securely save their card information, making future transactions faster and more convenient. Fraud Prevention: By using tokens instead of actual card numbers, CoFT significantly reduces the risk of fraud. Customer Trust: Adherence to CoFT guidelines enhances customer trust by demonstrating a commitment to data security.

Conclusion

The implementation of CoFT is a crucial step towards enhancing merchant security and protecting customer data. Adhering to the RBI guidelines on Card Tokenisation is not only a legal requirement but also a wise business decision. By following the steps outlined above, customers can ensure their card information is securely tokenised, providing peace of mind during online transactions.