The term tokenization refers to create a numeric or alphanumeric number in place of the original card number. It is difficult for hackers to get original card numbers. Let us see an example, data analysis. Here, card numbers masked with other junk characters for security purpose.
Popular Tokenization ServersThere are two kinds of servers currently popular for implementing tokenization.
Vault-based serverThe term vault based means both card number and token will be stored in a Table usually Teradata tables. During increasing volume of transactions, the handling of Table is a big challenge.
Every time during tokenization it stores a record for each card and its token. When you used a card multiple times, each time it generates multiple tokens. It is a fundamental concept.
So the challenge here is Table size will be increased.
Vault-less serverThe recently established technology is much faster than the vault based model, where the card numbers and tokens will not be stored. Whenever it received a request, it generates a random number.
Even during de-tokenization, it just decode the random number and sends actual card number. Also possible to send numeric/alpha numeric tokens.
Also read: Top books on credit cards domain