Mastercard has announced that 49 percent of all e-commerce transactions in Europe now use tokenization technology, just one year after the company committed to eliminating manual card entry and passwords by 2030. The milestone marks a major step toward its goal of reaching 100 percent tokenization across European online transactions.
Security Through Tokenization and Passkeys
Tokenization is a process in which a user’s sensitive payment card information is replaced with a unique digital identifier, or token, that can be safely stored and transmitted without exposing actual card details. This significantly reduces the risk of fraud in online payments by removing valuable data from the transaction flow.
Mastercard’s broader initiative also includes the deployment of passkeys – cryptographic credentials stored on a user’s device that can be accessed through biometric authentication, such as fingerprint or facial recognition. Unlike passwords or one-time codes, passkeys are resistant to phishing and cannot be reused, intercepted, or stolen in traditional ways. This approach reflects a shift away from knowledge-based authentication toward more secure, device-bound methods.
In line with this effort, Mastercard has begun rolling out its own Payment Passkey Service, which integrates tokenization with passkeys and the Click to Pay platform. This service allows consumers to authenticate payments with a fingerprint or face scan, without needing to enter passwords or verification codes, streamlining the checkout experience and enhancing security.
Industry-Wide Adoption and Consumer Impact
The announcement comes amid a broader industry movement toward secure, frictionless authentication. The FIDO Alliance recently reported that billions of accounts now support passkeys, and significant advances are expected in the banking, payments, and travel sectors in the coming year. Mastercard’s efforts align with these trends and follow similar developments such as Visa’s introduction of passkeys for online payments earlier in 2025.
These changes are also being driven by consumer demand. Mastercard’s internal research shows that many European shoppers are frustrated by checkout friction, including the need to create accounts or manually input card data. The adoption of tokenization and passkey-based authentication helps address these concerns by providing a faster, more seamless experience.
Mastercard’s progress is further supported by a wide ecosystem of partners – including banks, payment processors, and major retailers – who are helping to implement tokenization, Click to Pay, and biometric authentication at scale. These partnerships are crucial to meeting the company’s 2030 objective and building trust in digital commerce.
Underlying this transformation is a framework of industry standards and regulatory support. In the EU, rules under the Revised Payment Services Directive (PSD2) mandate strong customer authentication, encouraging the adoption of technologies like tokenization and passkeys. Organizations such as the FIDO Alliance and EMVCo are also shaping the technical standards that underpin these systems.
“One year into our 100% tokenisation and authentication journey, Europe is gaining strong momentum,” said Brice van de Walle, Executive Vice President, Core Payments Europe at Mastercard.
Source: Finextra
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June 4, 2025 – by Ali Nassar-Smith
