Card on File Transaction

A Card-on-File Transaction is a specific type of payment transaction where the payment is made using a cardholder’s credit or debit card information that has been previously stored securely on a merchant’s server.

This type of transaction is especially prevalent with subscription-based services, online retailers, or any business where customers are likely to make repeat purchases or require recurring billing.

Leveraging card-on-file transactions significantly simplifies and accelerates the checkout process, enhancing the overall customer shopping experience by removing the need to manually enter card information with every purchase.

While this convenience can boost sales and customer loyalty, it necessitates robust security standards, including encryption, tokenization, and adherence to the Payment Card Industry Data Security Standard (PCI DSS), to safeguard the stored card information against data breaches and fraudulent activities.