In tokenization, which statement is true about the Index Token?

• A. It encrypts PAN with a symmetric key.
• B. It doubles the PAN for redundancy.
• C. It stores PAN in plaintext in a secure vault.
• D. It replaces PAN with an index-based value.

Answer: (D)

Tokenization replaces the actual PAN with a non-sensitive surrogate that can be used for processing. The Index Token is a surrogate value that serves as a pointer into a token vault where the real PAN is stored. This means the merchant or processor only handles the index token, and the vault can retrieve the PAN when needed. The other options describe encryption, redundancy, or storing the PAN in plaintext, which do not describe how an index-based token operates. Therefore, replacing PAN with an index-based value is the correct characterization of the Index Token.