Visa (NYSE:V)MasterCard (NYSE:MA) and American Express (NYSE:AXP) have teamed together to push for greater security in the payment industry through tokenization. What exactly is tokenization, though? The Motley Fool spoke with an expert to find out.

The history
In October of last 2013 MasterCard, Visa, and American Express announced they would be joining forces in an effort to propose a new standard for simpler and safer shopping across the global in the payments industry through tokenization.

The announcement noted this new standard would "allow the traditional account number to be replaced with a digital payment "token" for online and mobile transactions."

These efforts were highlighted even further when in January EMVCo -- a technical body in the payments industry jointly owned by American Express, MasterCard, Visa, and others -- announced it would be seeking to standardize tokenization across the payments industry. 

That news said the standard would "help provide the payments community with a consistent, secure and interoperable environment to make digital payments," as greater security is pushed for.

The thought of a a secured, individual payment "token" generated and transferred, is easy to imagine, it's difficult to grasp.

In the video below, Motley Fool contributor Patrick Morris speaks with Matt Getzelman of Coalfire, a risk management firm, at the payments industry TRANSACT14 conference to better understand exactly what tokenization is.

Patrick Morris has no position in any stocks mentioned. The Motley Fool recommends American Express, MasterCard, and Visa. The Motley Fool owns shares of MasterCard and Visa. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.