Contactless card payments make transactions faster and easier when shopping in person, in much the same way a digital wallet or stored payment information streamlines shopping online. However, like all forms of payment, contactless cards also come with concerns, the biggest being fraudulent activity. This leads many to wonder whether this payment method is a safe option to use.
If you are among those wondering about the security of contactless cards, we’ll explore how they work, the concerns to be aware of, and ways to mitigate these risks to bring you peace of mind. We’ll also examine why this payment method has become one of the most popular available, used for 38 per cent of all UK payments.
What Are Contactless Cards and How Do They Work?
Contactless cards are credit and debit cards that allow you to pay by tapping or holding the card within a few inches of a card reader. They use near-field communication (NFC), which employs radio frequency identification (RFID) to authenticate and process payments. The payment process creates a unique one-time code, which encrypts payment data to be read by payment processors, securing transactions for consumers and businesses. This saves you from swiping or inserting your card and entering your PIN to authorise payments, speeding up the checkout process. NFC technology also allows the use of Apple Pay and Google Pay for in-person payments.
These cards still have all the same functionalities as non-contactless cards, including chips, credit card numbers, and a magnetic stripe. This means they can still be used when a tap option isn’t available in person or for online activities like shopping or playing at an online casino with no wagering spins from casinos.com.
Why Are Contactless Cards Popular?
Contactless cards have become a widely used payment method. They hold several benefits, such as convenience and ease of use, that make them useful to consumers and businesses. Contactless cards save you time at the checkout by cutting out steps like entering a PIN or inserting a card. This also makes it a more hygienic payment method, as you don’t have to use the PIN pad, a high-touch surface where germs can easily spread.
Contactless cards protect against credit card skimming, which aims to collect credit or debit card information using the card’s magnetic strip with skimmers. Skimmers are discreet devices that can be added to card readers to collect card information. They are incredibly difficult to spot. Information can also be collected from chip readers using devices known as shimmers. With the information collected by these devices, criminals can make purchases using your information or create illegal card clones.
Contactless cards prevent your card information from being skimmed by avoiding the magnetic stripe or chip and encrypting personal information during payment processing. Because of this, contactless payments, whether with a card’s tap capabilities or with a mobile wallet, are considered more secure than chip or swipe payments.
What Concerns or Risks Do Contactless Cards Have?
While these advantages are appealing, there are a few concerns that contactless card users should be aware of to protect their financial information. Tap-to-pay options have limits on how much users can pay with their contactless cards, and for some people, this can be a frustrating limitation. One reason for the limits on contactless cards is that stolen cards are far easier for thieves to use for fraudulent purchases, making this one of the biggest concerns with this payment type. While the actual cardholder can dispute fraudulent spending, this process can be lengthy and frustrating. It can also leave you and your finances vulnerable while trying to resolve the issue.
How Can These Concerns and Risks Be Mitigated?
Thankfully, you’re not powerless when it comes to mitigating the risks associated with contactless cards, swipe cards, or chip cards. These four tips are helpful ways to protect yourself.
1. Use an RFID Blocker
A common but highly unlikely concern with contactless cards is that users will be charged for purchases they aren’t making simply because their card is near a payment being processed. This is unlikely to happen because NFC requires the card to be very close (about two or three inches) to the card reader, making it difficult for the card reader to pick up a card in your wallet. However, if the concern worries you, you can use an RFID blocker to store your cards when they’re not in use. RFID blockers disrupt or block frequencies to prevent your card from being scanned.
2. Keep Your Card in Sight
Whether you use a contactless card or not, keeping your card in sight when making payments is an important way to protect your card information. Rather than sending your card off with a salesperson or waiter when paying for something, take the card to the POS machine yourself. Doing this ensures your card never falls into the wrong hands or is used without your knowledge.
3. Carry Your Card in a Secure Place
To protect your card from theft, carry it in a secure place that’s difficult for someone other than you to access. Avoiding easily opened or accessed pockets or bags minimises the risk of someone stealing your card or entire wallet.
4. Regularly Check Your Card Payments and Credit Reports
Regularly checking your card statements and credit reports allows you to quickly identify if your card’s information has been compromised, enabling you to act promptly to limit fraudulent activity and protect yourself.
Conclusion: Contactless Cards Provide a Safe and Convenient Way to Pay
Though contactless cards are not without risks, they are generally considered a safe payment method that is, in many ways, more secure than traditional card payments involving magnetic stripes and chips. Plus, they make checking out much more convenient than paying with cash or entering your PIN.