Definition
A terminal master is a cryptographic key used to protect sensitive data during transactions in payment systems. It enables companies to safeguard customer information from malicious parties.
How a Terminal Master Key Works
- A secure payment system generates a terminal master key – a unique and secret code generated specifically for a payment terminal.
- The master key is received by authorized parties within the payment system (e.g., banks, payment terminal manufacturers, and payment processors).
- The terminal master key encrypts sensitive data (like payment details) during transactions.
- The authorized recipient at the payment processing end has a corresponding master key that decrypts the data. This enables the retrieval and processing of the original information for verification and further processing.
Terminal Master Key Use Cases
- Retail transactions: TMK is essential in securing payment card transactions in a retail setting. When a customer purchases with their payment card, the terminal master key encrypts the sensitive data (like card details and PIN), protecting it during transit and storage.
- Hospitality industry: TMK helps to protect payment card data and customer information in POS terminals, ensuring secure payment processes for guests in restaurants, hotels, and other establishments.
- Financial institutions: Banks and financial institutions use TMK to protect payment card transactions at ATMs and other self-service terminals.