• Published on 29 August 2024
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Mastercard launches Payment Passkey in India for secure checkouts

Mastercard announced the worldwide launch of its new Payment Passkey Service to make online shopping more secure and easier than ever.

The Payment Passkey, debuting first in India as a pilot with some of the nation’s largest payment players—including aggregators like Juspay, Razorpay, and PayU, online merchants like bigbasket, and leading banks like Axis Bank—will give millions of consumers more control and peace of mind when checking out online."

Despite the rising popularity of one-time passwords (OTPs) due to their ease of use, they are increasingly vulnerable to online scams such as phishing, SIM swapping and message interception. In India, fraud cases have surged by nearly 300% in the last two years, as reported by the Reserve Bank of India’s Annual Report for 2023-2024.

Enter payment passkeys

They use device-based biometric authentication methods such as fingerprints or facial scans, but for an entirely new purpose: to streamline online shopping experiences. By replacing traditional passwords and OTPs, the Mastercard Payment Passkey Service makes transactions faster and more secure against fraud and scams. With payment passkeys, consumers can say goodbye to the hassle of forgetting or accidentally sharing their passwords or OTPs.

The service leverages passkeys and tokenisation to secure a consumer’s online checkout interaction, ensuring that the transaction is secure and no financial account data is shared with third parties—rendering it useless to fraudsters and scammers. The Mastercard Payment Passkey Service is a game changer for online commerce:

• Shoppers choose their Mastercard when checking out as a guest or select a card already stored securely on file with a merchant.
• To confirm the payment, users can use the biometric authentication mechanism features on their device – whether it’s a fingerprint, face scan or PIN.
• Upon successful authentication, the payment is instantly completed.

Jorn Lambert, chief product officer at Mastercard, said: “By introducing the Mastercard Payment Passkey Service in India, we’re advancing secure online
checkout and our vision for a token economy.”

Lambert added: “Through innovative technology that enhances security and convenience, we’re creating a more transparent commerce ecosystem for all. As we continue to lead the way in digital payments, our commitment to achieving a tokenised future is stronger than ever.”

India, with its rapidly expanding payment ecosystem and advanced tokenisation market, is embracing payment passkeys and enhanced biometric authentication in line with the Reserve Bank of India's goal for a safer, more resilient payment system. Payment passkeys aren’t just about speed and convenience— they’re about safety and enhancing a user’s shopping experience. For businesses, it means fewer abandoned carts and less fraud. For consumers, it means faster checkouts and peace of mind.

Gautam Aggarwal, division president, South Asia, Mastercard, said: "India’s digital transformation has truly laid the foundation of Viksit Bharat. Mastercard supports India's vision by making commerce smarter, safer, and more inclusive. Today’s global launch of the Mastercard Payment Passkey Service pilot here in India reflects two things - recognition of India’s global leadership in tokenisation and Mastercard’s dedication to supporting the digitisation journey. The imperative is enhancing digital interactions for all stakeholders while embedding trust in every touchpoint.”

The Mastercard Payment Passkey Service is built for online or remote tokenised transactions, which today help significantly reduce fraud and increase approval rates. By combining the tokenisation of payment credentials with seamless biometric authentication, Mastercard is bringing EMVCo, World Wide Web Consortium and the FIDO Alliance industry standards together to speed and secure the checkout experience.

India's pilot programme will be followed by a global rollout of the Mastercard Payment Passkey service to more consumers and financial institutions in the coming months.

Sanjeev Moghe, president and head of cards and payments, at Axis Bank, said: "We are excited to be partnering with Mastercard to pilot its Payment Passkey Service as an alternate transaction authentication method and provide our customers a non-OTP-based solution for transaction management.”

Moghe added: “This will allow us to provide more engaging usage and in-app experience for customers who desire enhanced security and frictionless payments.”

Sheetal Lalwani, chief operating officer and co-founder of Juspay, said: “Enabling this industry-first proof of concept underscores Juspay’s commitment to empower merchants with innovation and technology that improves the e-commerce experience.”

Lalwani added: “We believe this solution will help our merchant customers improve payment success rates and overall sales. With this pilot, merchants can significantly improve the payment experience for end consumers, allowing them to make payments easily, without multiple redirects, in a safe and secure way using device biometrics. We are working with Mastercard in shaping a future where digital payments are seamless and accessible to all, enabling merchants to better serve their customers.”

Manas Mishra, PayU’s chief product officer said: "As the country’s payment ecosystem matures, the demand for advanced and secure payment solutions is greater than ever.”

Mishra added: “At PayU, we are relentlessly focused on pushing the boundaries of payment security and user experience as a resiliently progressive payments platform. Integrating the Mastercard Payment Passkey Service is a pivotal step in that direction. This partnership reflects our commitment to embracing cutting-edge payment technologies and reinforces our role in setting new benchmarks for security and efficiency in digital transactions."

Arif Khan, chief innovation officer of Razorpay, said: "We are thrilled to join forces with Mastercard to introduce its Payment Passkey Service in India, a groundbreaking initiative that enhances transaction security and user experience in remote commerce, leveraging the power of biometric authentication.”

Khan added: “At Razorpay, our focus is on the 3 's's — safety, simplification and success rate — to ensure seamless and secure online payments. We strive to stay ahead of the curve by integrating advanced technologies that not only safeguard our merchants and their customers but also streamline the payment process."

Re-disseminated by The Asian Banker