Tokenization of Sensitive Data

Encryption transforms sensitive data, such as a card or account number, into an unreadable format using cryptographic keys. With the right key, the encrypted data can be decrypted back into its original form. Tokenization, on the other hand, replaces sensitive data with a randomly generated token that has no exploitable value outside the secure tokenization system. Unlike encryption, tokenization is irreversible; the original data cannot be retrieved from the token itself.

Instead of obscuring the original data with a cryptographic puzzle (as encryption does), tokenization substitutes it with a placeholder. The true sensitive data is stored securely in a separate vault, accessible only through the tokenization platform. Even if attackers intercept the tokens, they cannot reconstruct or use them.

Yes. For payment card data specifically, tokenization offers stronger protection than encryption. Tokens are worthless outside of the secure system, eliminating the risk that intercepted data could be decrypted later. This makes tokenization particularly effective at reducing risk exposure and minimizing PCI DSS scope.

The PCI Security Standards Council (PCI SSC) established 12 PCI DSS requirements that all businesses handling cardholder data must follow. The fastest and most cost-effective way to achieve PCI compliance is to use the VGS PCI-Compliance solution. This solution helps organizations reduce compliance scope, offload security responsibilities, and meet PCI standards efficiently. Speak with a PCI expert to explore your compliance roadmap.

Tokenization is recognized by the PCI SSC as an effective method to protect payment data and reduce PCI DSS scope. VGS provides tokenization solutions tailored for different business models, from merchants to service providers. By integrating tokenization, you can significantly simplify your compliance journey, enhance your security posture, and reduce audit complexity.

No. While payment card tokenization is the most common use case, tokenization can protect a wide range of sensitive data, including Social Security Numbers, bank account information, health records, and personal identifiers. Any data element that could expose individuals or businesses to risk can be tokenized.

No. Unlike encryption, tokenization cannot be reversed without access to the secure token vault. This makes tokens fundamentally different from encrypted values, which can be decrypted with the proper key. The only way to retrieve the original data is by using the authorized tokenization platform.

Yes. Please refer to our product documentation here for in-depth details on tokenization, PCI compliance, and how VGS helps organizations secure data.

A token service provider (TSP) is a secure technology company responsible for generating, issuing, and managing payment tokens. These tokens are unique digital identifiers that replace sensitive cardholder data, such as the Primary Account Number (PAN), during transactions.

Yes, VGS is one of the only PSP-agnostic token service providers. This independence allows merchants or enterprises to tokenize payment card data and manage tokens without being locked into a specific payment processing partner.