The short answer
Tokenization is the process of replacing card numbers with tokens — non-sensitive references that represent the card without exposing the underlying data. Merchants store tokens, not PANs. Processor stores the mapping.
In plain English
Your customer enters their card number on your checkout. Stripe.js, Square Web Payments SDK, or Authorize.net Accept.js grabs the card number client-side, sends it to the processor's tokenization endpoint over TLS, and gets back a token (e.g., `tok_1Abc234XYZ`). Your server receives only the token. The actual card number never touches your infrastructure.
When you need to charge the same card again (subscription renewal, repeat customer), you reference the token. The processor translates the token back to the card data behind their PCI-scoped firewall and processes the charge.
How it shows up in your business
- Saved cards on subscription products work via tokens — your database stores tokens, not card numbers.
- PCI scope shrinks dramatically. SAQ A (tokenization-only, no card data touch) vs SAQ D (stores PANs) is a huge compliance simplification.
- Tokens are typically acquirer-specific. A Stripe token doesn't work on Square. Migrating requires either re-tokenization at the new processor or using a processor-agnostic vault.
- Network tokens (Visa, Mastercard) are newer — processor-agnostic tokens usable across acquirers. Growing adoption.
Numbers to know
Tokens typically start with a processor-specific prefix and are 20-50 characters of alphanumeric data. Stripe customer tokens: `cus_xxx`. Stripe card tokens: `card_xxx` or `pm_xxx`. Token lifetime: usually permanent unless the customer revokes or the card is reported compromised.
PCI-DSS scope with tokenization: typically SAQ A (lightest). Without tokenization (storing card data): SAQ D (heaviest, annual audit required at Level 1).
Why multi-brand operators care
Across a multi-brand portfolio, tokenization + the processor's customer vault (Stripe Customers, Authorize.net CIM, Braintree Vault) is the difference between one-off checkouts and recurring relationships. Tokens let you move a customer between sub-brands under the same parent without re-entering card data. multiflow respects the vault of your underlying processor — we don't add a second tokenization layer; we work above the one your processor already has.