Token Service Provider (TSP)

A Token Service Provider is a system or service that generates, issues, and manages tokens on behalf of issuers for mobile and digital payments. TSPs play a crucial role in securing payment systems by replacing sensitive cardholder information with unique identifiers or tokens that are useless if intercepted.

These tokens are used to facilitate transactions without exposing the actual card details. The TSP is responsible for managing the lifecycle of the token, from its creation to its deactivation. This includes:
generating the token
mapping it to the actual card number
ensuring that it is used only for authorized transactions

The TSP also performs security checks to verify the authenticity of the transaction and prevent unauthorized use of the token. By replacing the actual card number with a token, the TSP helps to reduce the risk of cardholder data being exposed or stolen during the transaction process.

This is particularly important for mobile and digital payments, where the risk of data interception is higher. Moreover, TSPs often work in collaboration with card networks, payment processors, and mobile wallet providers to ensure seamless and secure transactions across the entire payment ecosystem.