NMI Supports Network Tokenization to Cut Costs and Boost Security for ISOs and Merchants
NMI®, a leading global provider of embedded payments infrastructure, has announced the launch of its Customer Token Vault, an extension to the NMI Gateway. This new offering brings network tokenization to the forefront of payment processing, allowing for dynamic tokens to be issued and managed by major card networks. Additionally, it provides the ability to securely store and protect sensitive card data for processor-agnostic provider tokens, offering businesses enhanced security and greater control over payment processes.
The NMI Customer Token Vault was designed to address some of the most pressing concerns in the payments ecosystem today, including fraud, chargebacks, and rising transaction costs. By leveraging network tokenization, businesses can lower interchange fees, boost acceptance rates, and reduce chargebacks—all while strengthening security and improving the overall customer experience.
As online transaction fraud continues to rise, the introduction of the NMI Customer Token Vault offers ISOs, software providers, and merchants an advanced solution to meet evolving security standards. The platform helps reduce the risk of data breaches, simplifies compliance with PCI DSS regulations, and enhances the overall efficiency of payment processes. These benefits make it an essential tool for businesses looking to adapt to the growing demands of digital commerce and improve their security posture.
Jared Drieling, Chief Innovation Officer at The Strawhecker Group (TSG), highlighted the importance of network tokenization: “Merchants adopting network tokens are seeing tangible benefits, including reduced fraud and improved approval rates. Led by the likes of Mastercard and Visa, network tokenization represents a significant advancement in securing payment transactions while enhancing the overall efficiency of digital commerce. As the adoption of network tokens continues to rise, we are seeing a safer and more efficient payments ecosystem better equipped to support the growing demands of digital commerce.”
NMI’s Senior Product Manager, Lisa Lloyd, emphasized the game-changing nature of network tokens, especially for subscription-based and digital businesses: “From reduced costs, chargebacks, and fraud to higher approval rates, network tokens are a game-changer—particularly for businesses that use ‘save card’ features. It eliminates the hassle of updating expired card details and reduces declined transactions, making online shopping smoother than ever. With NMI Customer Token Vault, we’re providing our partners with a solution that not only lowers costs but also elevates transaction security and delivers a better payment experience for consumers.”
Chris Gains, CEO of International Payment Solutions, also praised the benefits of network tokens for merchants: “Network tokens offer tremendous value to our merchants and their customers. By leveraging network tokens with NMI Customer Token Vault, we’ve seen a noticeable improvement in approval rates for subsequent transactions, and we expect ongoing reductions in fraud and chargebacks. For small business owners, this is a significant advantage and builds trust from the very start, paving the way for seamless recurring sales.”
The NMI Customer Token Vault offers merchants a more secure payment environment by replacing traditional primary account numbers (PANs) with dynamic tokens. These tokens are managed directly by the card networks, significantly reducing the risk of exposure to raw cardholder data. By using network tokens, merchants can benefit from higher transaction approval rates, lower interchange rates, and improved overall security. Additionally, because tokens are not considered cardholder data, businesses can reduce the scope of PCI compliance, making it easier to manage payment security.
One of the standout features of the NMI Customer Token Vault is its automatic card detail updates. The issuing networks will automatically update card information, ensuring that merchants always have the most current payment details on file. This feature helps reduce the occurrence of declined transactions due to outdated or incorrect card details, ultimately improving authorization rates and customer satisfaction.
Key Benefits of NMI Customer Token Vault:
1. Cost Reduction: By lowering interchange fees, reducing declines, and minimizing chargebacks, businesses can save significantly—especially those with high transaction volumes.
2. Transaction Continuity: Automatic updates to card details ensure that customer payment information is always up-to-date, reducing the likelihood of declined transactions and improving authorization rates.
3. Increased Authorization Rates and Reduced Fraud: Merchants using network tokens experience up to a 30% reduction in fraud rates and a 4.6% increase in approval rates, driving higher revenue and minimizing fraud-related costs.
4. Chargeback Minimization: With network tokens, liability for chargebacks shifts, helping merchants secure their transactions and reduce false declines.
5. Enhanced Data Security: Network tokens eliminate the need for merchants to store and handle sensitive cardholder information, reducing the risk of data breaches and making it easier to comply with PCI standards.
In addition to these benefits, the NMI Customer Token Vault also enables processor-agnostic tokenization, providing businesses with the flexibility to work with multiple payment processors while maintaining high levels of security.
As the payments landscape continues to evolve, NMI’s Customer Token Vault represents a critical tool for businesses looking to enhance their security, streamline payment processes, and offer a better experience for both merchants and consumers. By adopting network tokenization, businesses can stay ahead of the curve, reducing fraud, improving transaction approval rates, and enhancing the overall payment experience.
