2025 Global Overview of QR Payments
Tokenization has undergone a remarkable evolution in recent years, transforming from a mere PCI compliance tool into a strategic payments technology that powers the future of digital commerce. Today's financial industry relies on tokenization as the backbone of secure, seamless, and intelligent payment experiences across the digital landscape.
For organizations navigating an increasingly complex payments ecosystem, token-based solutions serve as both a foundation for security and a catalyst for innovation.
Quick history & key milestones
Since its inception as a solution for PCI DSS compliance and fraud protection, tokenized security has offered organizations a way to substitute sensitive card details with non-sensitive tokens, significantly reducing security risks and compliance scope. The landscape evolved dramatically with the emergence of network tokenization, championed by major card schemes like Visa and Mastercard, which brought substantial performance improvements and lifecycle management capabilities.
The scale of adoption has been impressive. By 2024, Mastercard reported that approximately one-third of global transactions used tokenization. Visa's ambitious approach has resulted in more than 12.6 billion tokens issued globally by early 2025, demonstrating substantial growth compared to previous years. These figures highlight the transition of this security approach from a niche technology to a mainstream payment infrastructure.
Major payment players have made significant strategic shifts around token-based technologies. PayPal's "Everywhere" campaign expanded its reach into physical retail, leveraging its vast network of over 850 million cards tokenized via Braintree. This omnichannel approach aims to deliver consistent, secure payment experiences across multiple touchpoints.
Meanwhile, Apple made a pivotal move by opening its Secure Element to third-party applications with the release of iOS 18.1. This development allows developers to access the iPhone's secure hardware features for payment applications and introduces support for MPANs (Merchant Payment Account Numbers) specifically designed for recurring payment scenarios.
How are traditional financial institutions responding to the digital wallet revolution? In the United States, Paze has emerged as a tokenized, no-app checkout solution that comes with over 150 million cards preloaded from participating banks. This bank-led initiative emphasizes security and streamlined user experience without requiring customers to manually add payment credentials.
In Canada, Konek has taken a different approach by offering card-free, tokenized payments via Interac authentication—allowing consumers to pay directly from their bank accounts while maintaining robust security measures. This approach has resonated with consumers seeking simplified payment experiences without compromising control of their financial relationships.
Despite its widespread adoption, the tokenization ecosystem has become increasingly fragmented. Global schemes (Visa, Mastercard, Amex), domestic networks, Token Service Providers (TSPs), and aggregators all operate with different protocols and requirements. For financial institutions, navigating this landscape has become more challenging, requiring significant technical resources to evaluate and integrate these varied options effectively.
The future of digital payment security will be increasingly intertwined with artificial intelligence. Beyond the core security benefits that tokens provide, AI-enhanced systems are emerging to deliver more sophisticated fraud detection and personalization capabilities. A notable example is the rise of AI-powered electronic identity verification (eIDV) during card and token enrollment processes, adding an additional layer of protection against fraud. Financial institutions are increasingly finding that combining AI-enhanced fraud detection with tokenization delivers tangible improvements in transaction approval rates while maintaining strong security postures.
Increasingly, token-based methods underpin next-gen commerce, particularly in IoT-based use cases. From in-car payments to EV charging solutions, secure tokenized credentials will enable frictionless transactions without compromising security. This shift fundamentally changes how businesses approach digital transactions. The industry is witnessing early convergence between payment tokenization and tokenized identity, pointing toward a more unified digital commerce ecosystem.
Once a niche tool, tokenization is now core to payment infrastructure. Yet, in this rapidly evolving landscape, challenges remain. Financial institutions face mounting obstacles in this fragmented ecosystem: integration costs, technical complexities, and future-proofing concerns chief among them.
HPS makes a difference through its central tokenization hub. This unified platform connects different schemes and token types, enabling clients to integrate once and access multiple tokenization service providers seamlessly. As the PowerCARD-Tokenization Hub continues to evolve, HPS remains committed to making token management easier, safer, and more scalable for institutions navigating this complex landscape.
To find out more, check out HPS's PowerCARD Tokenization - https://www.hps-worldwide.com/product/powercard-tokenisation.
