Contactless card payments have become increasingly popular, offering a seamless and secure payment experience. In this blog post, we will analyse the ins and outs of how to use a contactless card.
What is a contactless card?
Contactless payments have gained popularity worldwide, including in Europe, Australia, Canada, and the United States.
Often called ‘tap-and-go’, these payments offer a convenient and speedy way to complete transactions by tapping or waving a contactless-enabled card or device over a reader. The payment process is up to 10 times faster than traditional methods like swiping, inserting, or using cash. Moreover, you can make low-value transactions using this payment method without a PIN.
How do contactless payments work?
Contactless cards use radio-frequency identification (RFID) technology. It allows the cards to communicate with card readers when held near the reader during a transaction.
These cards usually look like traditional credit or debit cards but contain an EMV chip. Therefore, instead of inserting the card into a reader, you can only hover it over the device.
When you hold a contactless card near a contactless reader, it securely authenticates the card information. The merchant’s point-of-sale system sends the transaction to the card issuer. Then the issuer analyzes the transaction and approves it accordingly.
This process involves multiple steps. However, the process usually takes less than a second.
NFC technology, used in contactless cards, is not limited to credit and debit cards and card readers alone. You may use a mobile phone or a watch for these transactions. By connecting these devices to your bank account, NFC technology enables their use for contactless transactions.
A contactless symbol
Above, a contactless symbol is visible. You can make NFC payments if you see the contactless symbol on the back of your contactless credit and debit cards.
Moreover, if you see a contactless symbol on a payment reader, then it accepts tap-and-go payments.
The limit on contactless cards
Originally there was a £10 spending limit per transaction to mitigate the risk of misuse in case of card loss or theft. This limit was for small transactions like buying coffee or bread.
However, due to the rising popularity of contactless payments and consumer demand, the spending limit has gradually increased over time. Contactless cards are now commonly used for larger purchases such as grocery shopping or fuel.
Now you can make NFC payments of up to £100 without entering your credit or debit card PIN. However, if you exceed the contactless card limit, you will need to make chip and PIN transactions.
If you wish to control your spending or adhere to a specific budget, you have the option to lower your contactless limit from the maximum of £100. You can change the limit on your card provider’s mobile banking app.
Is it safe to make a contactless payment?
Contactless cards offer a high level of security. During the transaction, it generates a unique code or password. This one-time code enhances safety by preventing the reuse of the code. Moreover, only the card-processing network can read the code.
Even though there are concerns about the security of these cards, contactless card fraud rates remain low. While it does not require a PIN entry, there are some limitations to mitigate risks, like the number of contactless card transactions you can make over a certain period.
If someone stole and used your contactless card, your bank should provide reimbursement. Therefore, contactless cards offer both convenience and security for cardholders.
Benefits of contactless payments
Contactless payments have a few relevant advantages:
- Speed and convenience
It makes transactions quicker and more convenient and results in reduced queuing time. It benefits both consumers and retailers and enhances the overall customer experience. - Extra security and fraud protection
Additional measures like limits on the number of transactions help avoid unauthorized use. Also, these cards provide the same anti-fraud protection as chip-and-PIN cards, ensuring the safety of cardholders’ details. - Hygiene
This method eliminates the need to handle physical cash or touch the pin pad on payment terminals. - Additional uses
For example, you can use contactless cards to facilitate payments for public transportation.
Disadvantages of contactless card payments
There are some concerns concerning NFC payments that have to consider.
- Vulnerability to theft
If you lose your card, unauthorized individuals might use your card to make NFC payments. It is essential to notify the card company to stop fraudulent transactions. - Limitation of recognition overseas
You may stumble upon situations where NFC payments aren’t accepted abroad. In this case, you might have to use your credit or debit card PIN or carry local money. - Risk of overspending
Since contactless payments only require a simple tap on a payment reader, it can be alluring to go over budget. NFC payments might not offer the same level of awareness as cash transactions. It could result in impulsive purchases.
FAQ
Where can I pay using contactless cards?
Many establishments accept contactless cards. Searching for the contactless symbol will tell you if a location supports NFC payments. It is frequently shown at cash registers or on card readers.
The transportation industry has also come to accept contactless payments. Certain public transit providers accept contactless payments. It allows travellers to tap and pay for their travels.
How to know if your card is contactless?
Examine the back of your card for the contactless symbol to see if it allows contactless payments. This sign is distinguished by four curving lines that grow in size from left to right.
How do I use my contactless debit card for the first time?
When you receive a card in the mail, you might need to activate it by phone. It depends on your bank or credit or debit card provider.
You must enter your PIN to activate your contactless card the first time you use it. After completing this initial transaction, you can use contactless payments for future transactions without entering your PIN.
How do you use contactless in a shop?
Using contactless payment in a shop is simple and convenient. Here’s a brief overview of the process:
- Look for the contactless symbol on the card reader or payment terminal at the shop. It typically looks like a sideways Wi-Fi symbol or includes the word “contactless.”
- Ensure your contactless-enabled card or mobile device (such as a smartphone or smartwatch) is unlocked and ready for payment.
- Hold your card or device near the contactless symbol on the reader or terminal. Keep it within a few centimeters or inches of the symbol.
- Wait for a moment while the payment is processed. You may see a confirmation message on the screen or hear a beep indicating a successful payment.
- For larger transactions, the shop may ask you to verify your identity by entering your PIN on the card reader or terminal.
Remember, each country or region may have specific limits on the maximum transaction amount for contactless payments, and some shops may require a PIN entry for security reasons.
Who can accept contactless payments?
Retailers, restaurants, service providers, transportation providers, vending machines, and events venues can usually support contactless technology. For that, businesses typically use a contactless card reader or contactless-enabled payment terminal.
What to do if I lose my contactless card?
In case you lose your contactless card, you must act immediately:
- Contact your contactless credit card company.
Notify your bank or the issuer of your contactless credit or debit card. They will assist you in reporting the loss and restricting the card to avoid illegal use. - Maintain vigilance over your account.
Review your bank statement and transaction history frequently. You should immediately report suspicious charges or transactions to your contactless credit card company. - Request replacement card.
Your bank will tell you how to get the new card, which may require you to go to a branch or receive it by mail.
What if the contactless card doesn’t work?
If your contactless payment fails during a transaction, just put your card into the payment terminal and enter your PIN to successfully finish the purchase. Moreover, you can always contact your bank or card provider and seek a replacement.
Can I withdraw cash using a contactless card?
Unfortunately, the majority of ATMs still use the conventional chip-and-PIN system. Because the adoption of new technology differs by bank, it is best to contact your individual card issuer for further information on their services and the availability of contactless ATMs.
Can I pay with my contactless card to work abroad?
You should be able to use your contactless cards when traveling overseas. Since the NFC payment methods launch, most nations have accepted this payment system.
Unfortunately, you may be able to pay only if the retailer’s card reader displays the contactless symbol. You may also need to pay by inserting your card and entering your PIN, or by using cash.
Fortunately, since its launch, most nations have accepted this payment system.
Can you accidentally pay with your contactless card?
Concerns about contactless cards are understandable. However, contactless card readers are specially created to accept payments when a card is brought close to the device. Furthermore, these readers are set to deny charges if numerous cards are detected within range at the same time.
It’s worth mentioning that sellers must activate the payment terminal to conduct a transaction, making it unlikely that you’d mistakenly pay for someone else’s products while passing by. Accidental payments are uncommon as a result of these built-in safeguards.
Will I get charged twice if I double-tap the reader?
There is no need to be concerned about unintended double payments using contactless technology. The mechanism is meant to prevent a second tap from being detected, ensuring that you are only charged once. The technology’s safeguards and restrictions provide a trustworthy and accurate payment procedure, providing users with peace of mind.
Can I turn off contactless payments?
Yes, in most cases, you can enable contactless payments on your mobile banking app.
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