How does the VISA and Mastercard's token system work?

I can write a long writeup for this but I will try to give you a simple answer eliminating details but highlighting the concept. There are two process in this Token Ecosystem: Setup and Usage Setup: 1. read more

After successful validation, networks(MasterCard, Visa, Amex etc) create the Token and a copy is stored in Digital Wallet, Network and Issuer. Note that actual Credit Card number might not be stored in Digital Wallet so its safe with Issuer and Network. read more

Visa and MasterCard make the profit by charging fees to the issuing banks that participate in their respective payment networks. Their money is not made directly from merchant discount interchange fees by the merchant to the acquiring or issuing bank or from fees charged to the consumer. read more