MDES for Merchants

In a technology-centric world, where mobile phones have become integral for participation in digital society, the payments landscape is facing continued pressure to evolve and present options that are undeniably secure and convenient.

This is especially crucial due to the contemporary consumer spending culture whereby many store their account information in locations such as online retailers, airlines, transportation networks and wireless carriers amongst other things.1 The abundance of this sensitive information online exposes a significant proportion of the population to security and fraud threats.

Therefore, Mastercard has created MDES for Merchants (referred to as M4M) to combat these risks by way of tokenisation. By replacing sensitive payment credentials with digital tokens, a superior ecommerce experience is created which provides increased security, approval rates and a frictionless consumer experience. Ultimately, M4M enables a safer payment ecosystem, inspiring trust from consumers and increasing transaction volume across the digital channel to return greater revenue for merchants.


Mastercard Digital Enablement
Service for Merchants

What it is

The merchant payments landscape is undergoing a period of rapid, technology-driven change. To make payments a seamless part of the shopping experience, merchants increasingly encourage cardholders to store their payment credentials on file, powering faster checkouts, increased spend, and lower shopping cart abandonment.

MDES for Merchants allows merchants to convert the card information that consumers save on file into ‘tokens’ and to use this encrypted data to help secure transactions.

How it works

1. When you enter your card details, they’re immediately replaced with a Mastercard token.
2. The Mastercard token is unique to both you and the business you’re shopping with.
3. When you then make a payment, the token is transmitted – not the card details.
4. If your card details ever change, the new details are automatically mapped to the Mastercard token. This reduces preventable declined transactions and ensures continuity of your payments.

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What Is Tokenization?


Merchants want to optimize transaction approvals in the digital space so they need a solution
that can provide both a seamless experience for their consumers with
best-in-class security. MDES for Merchants does just that.

  • Keeps card information up to date
  • Consumers are relieved of the administrative burden of manually updating each merchant where their card is stored on file (known as COF)
  • Without lost and/or expired card declines slowing down the payment process, higher approval rates can be achieved, and merchants can capture greater transaction volume
  • Reduces the likelihood of card declines
  • The tokens used in this solution provide more information and greater visibility to card issuers during payment authorisation. This means that false declines, which occur due to incongruence between the standing of a consumer’s card and the issuer’s fraud logic are reduced, making it easier for consumers to shop
  • Provides an enhanced customer experience
  • Consumers don’t need to take any action; MDES for Merchants does the work for them to ensure that their payments go uninterrupted and become more secure
  • Removing the pain points of administrative effort, rejected payments and fraud attacks, the consumer experience is frictionless, encouraging higher purchase completion rates and increased revenue

55% of consumers use card on file2 and yet 81% are still concerned about the protection of these details.3 By removing card details in the digital space and substituting in merchant-specific tokens that are encrypted, tokens can only be used with intended issuer and therefore security attacks become more difficult.

  • A stolen token can’t be used at merchants without the corresponding cryptogram, so opportunity for fraud is significantly reduced
  • Fraud can easily be tracked to a single token and therefore MDES for Merchants enables greater control, as tokens tainted by fraud can quickly be revoked from use
  • As a result, consumers operating under a tokenised framework have peace of mind about the security of their payments and therefore are likely to spend 10 times more than digitally inactive customers, often returning up to 3 times more revenue.


Next Steps

If you’re a merchant interested in increasing transaction volume and ensuring greater protection for your consumers, speak to your Payment Service Provider (PSP) or ecommerce platform to instigate discussions around MDES for Merchants. The technical integration documents here could be useful for these discussions.

1 - Mastercard Newsroom, Mastercard Continues to Define the Future of Digital Payments with Tokenisation Support for App E-Commerce and Recurring Payment Card of File Programs, Purchase NY – June 15, 2015
2 - Mastercard Global ecommerce Research, 2016
3 - Glenbrook research for Consumer Control
4 - Mastercard Advisors Consulting, “Embracing Digital Payments To Influence Cardholder Behavior And Bank Loyalty,” 2015