Tap. Pay. Done.
Contactless credit cards and debit cards make it possible to “tap,” or hold, your card over a payment terminal to facilitate a payment.
Contactless payment is the latest advance in the evolution of credit card technology, from swiping a card with a magnetic stripe to dipping one with an EMV chip. In addition to the convenience it offers, contactless technology is designed to help make payments safer than if you used the older methods to pay for in-person transactions.
The technology is also gaining ground in the US, as 70% of retailers say they already have terminals that can accept contactless payments and 95% of new terminals are contactless enabled.
So are contactless cards safe to use? Here’s what you need to know before you start tapping.
Contactless credit cards and debit cards have several enhanced security features, the most obvious being how they can be used for payment. By allowing you to pay without bringing your card into contact with a payment terminal, contactless cards eliminate some of the opportunities for thieves to steal your credit card information.
In addition, each contactless card payment creates a transaction-specific, one-time code that cannot be duplicated ahead of time. These codes can’t be reproduced and can only be read by credit card processing networks.
How do contactless payments work?
When you tap your card within a few inches of the contactless payment symbol on a payment terminal, your card uses short-range wireless technology to send the payment for authorization. At that point, the payment terminal authenticates your credit card information, and the contactless card payment creates a transaction-specific, one-time code that is received by credit card processing networks.
Contactless credit cards and debit cards use radio-frequency identification and near-field communication technologies during the transaction to keep your credit card information and personal details safe.
Mobile wallets, like Google Pay and Apple Pay, use similar contactless technology and let you pay for purchases without inserting your credit card into a payment terminal.
To use a credit card with contactless technology, hold your card within a few inches of the contactless symbol on the payment terminal.
Authorization may take a couple of seconds, at which point the terminal display should indicate if your transaction has been approved. All other aspects of the transaction are facilitated by the merchant, the credit card processing network and the credit card issuer.
Contactless cards typically come with an EMV chip as well, which gives you another payment method if a retailer doesn’t offer contactless payment terminals.
For online purchases, you can use a contactless credit or debit card just like you would any other type of card, entering details like your credit card number, expiration date and CVV number to facilitate the payment.
How do I know if my card or device can make contactless payments?
Most major credit card issuers are making the switch to contactless payment credit cards. Credit cards that offer contactless payment technology have a contactless payment symbol on the front or back of the cards.
The symbol looks similar to a WiFi symbol turned on its side: 
. Payment terminals that accept contactless payments have a similar symbol but with a hand next to it: 
.
Is tapping to pay safer than swiping?
Contactless payment technology is typically considered the safest since some of the methods thieves use to hack into your card become virtually impossible to facilitate. For example, credit card skimmers installed on payment terminals require the card to come in physical contact with the device to steal the credit card information.
Contactless technology also encrypts credit card information using a process called tokenization, which produces a unique one-time code that payment processing networks can read.
Disadvantages of contactless cards
Although the use of contactless payment technology is becoming more prevalent, there are still places where you can’t use your contactless credit and debit cards. If the merchant doesn’t have a contactless payment terminal, you’ll have to swipe your card or insert it into the payment terminal for the transaction to go through.
Credit cards with contactless technology still typically include an EMV chip and a magnetic stripe.
Also, be aware that contactless credit cards may be “too easy” to use. If a thief picks up your credit card, they can easily use it for contactless payments without a PIN or a signature until you discover the fraud and report the card as stolen.
Can I unknowingly make a purchase if I am near a contactless payment-enabled system?
According to Visa, you have to hold a contactless card or mobile wallet within 2 inches of a contactless payment symbol on a payment terminal in order for a transaction to process. This makes accidental purchases unlikely. Contactless checkout terminals can only communicate with one card at a time, so tap the individual card rather than your whole wallet to ensure you’re paying with the card you intended.
FAQs
Contactless credit cards can also be EMV chip cards. However, contactless payments tend to be safer since the credit or debit card itself never makes contact with the payment terminal.
Someone else can use your contactless credit card if you lose it, but the same is true for any other type of credit card. The majority of credit cards offer $0 liability for fraudulent purchases, and federal law limits liability for fraudulent purchases made with a credit card to $50 at most.
Tap-to-pay is less vulnerable to credit card skimming and other types of fraud since the card itself never touches the payment terminal for a transaction. “Skimming” involves using a hidden device to read and translate credit card data when a credit card is swiped to make a purchase. But since contactless cards never come in contact with the device, skimmers can’t access the data.
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Contactless Payment Technology
Contactless payment technology allows you to make payments by simply tapping or holding your credit or debit card over a payment terminal. This technology has evolved from the traditional magnetic stripe and EMV chip methods. It offers convenience and enhanced security for in-person transactions.
Enhanced Security Features
Contactless credit cards and debit cards have several security features that make them safe to use. Firstly, they eliminate the risk of thieves stealing your credit card information by allowing you to pay without physically inserting your card into a payment terminal. Additionally, each contactless payment generates a unique, one-time code that cannot be duplicated in advance. These codes are encrypted and can only be read by credit card processing networks.
How Contactless Payments Work
When you tap your contactless card near a payment terminal, it uses short-range wireless technology to send the payment for authorization. The payment terminal then authenticates your credit card information and generates a transaction-specific, one-time code that is received by credit card processing networks. This process ensures the security of your credit card information and personal details.
Mobile Wallets and Contactless Technology
Mobile wallets, such as Google Pay and Apple Pay, also use contactless technology. They allow you to make purchases without physically inserting your credit card into a payment terminal. The process is similar to using a contactless card, where you hold your device near the contactless symbol on the terminal.
Using Contactless Cards Online
For online purchases, you can use a contactless credit or debit card just like any other card. You enter the card details, including the card number, expiration date, and CVV number, to facilitate the payment.
Identifying Contactless Payment Capability
Most major credit card issuers now offer contactless payment technology. You can identify if your card has contactless payment capability by looking for the contactless payment symbol on the front or back of the card. The symbol resembles a WiFi symbol turned on its side. Payment terminals that accept contactless payments also display a similar symbol, often with a hand next to it.
Safety of Contactless Payments
Contactless payment technology is generally considered safe due to its security features. It reduces the risk of credit card skimming, where thieves steal card information by tampering with payment terminals. Since contactless cards never physically touch the terminal, skimmers cannot access the data. Contactless technology also encrypts credit card information using tokenization, which generates a unique one-time code for each transaction.
Disadvantages of Contactless Cards
While contactless payment technology is becoming more prevalent, there are still some limitations. Not all merchants have contactless payment terminals, so you may need to swipe or insert your card in those cases. Contactless credit cards typically include an EMV chip and a magnetic stripe as alternative payment methods. It's also important to note that if your contactless credit card is lost or stolen, someone could potentially use it for contactless payments without a PIN or signature until you report it as stolen.
Accidental Purchases and Contactless Payments
To process a contactless payment, you need to hold your card or mobile wallet within a few inches of the contactless payment symbol on a terminal. Accidental purchases are unlikely because the terminal can only communicate with one card at a time. To ensure you're paying with the intended card, tap the individual card rather than your whole wallet.
In conclusion, contactless payment technology offers convenience and enhanced security for in-person transactions. It eliminates the need to physically insert your card into a payment terminal and generates unique transaction codes for each payment. While contactless payments are generally safe, it's important to be aware of the limitations and take necessary precautions to protect your credit card information.
