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Moving contactless payments to limitless payments

Zwipe Talks

Oslo, Norway




Adoption of contactless cards is rapidly being accepted in the payments world. The blog discusses how contactless payments are driving confidence and becoming an integral part of consumers' security.

Following the announcement by the UK Treasury of the increase in the contactless limit to £100 on March 3, 2021, BBC ran a news article explaining the impact of the change. Within a few days, nearly 2,000 comments were floating on the BBC news page and a significant number of the commentators were far from supportive of the move. Some asked how they could opt out of the increased limit, whilst others even wanted their issuer to exchange their existing card for one without a contactless capability.

Why is this? Why hasn’t the increase been universally welcomed? Most concerns point directly to a consumer perception around a lack of security.

The Revolution has started

Without a doubt, one of the big success stories within payments in recent years has been the adoption of contactless cards, including the US market, where most issuers are now sending out contactless cards as a standard. The reason is simple: the convenience and speed of simply tapping to pay makes the entire payment process faster and easier.

Then came Covid-19 and turbo-charged the contactless use case as consumers, after weeks of being told to wash and disinfect their hands, started to shun the PIN terminal. The £30 limit was raised to £45 and the contactless transaction rates shot up, culminating in 88.6%(3) of in-store card payments now being recorded as contactless. The revolution had started and the future of the PIN as a popular authentication method was once again brought into question.

Losing contact

From their introduction in 2007, there has always been an underlying consumer perception around a lack of security with contactless cards. Not surprisingly, following the campaign in the early 2000s to bring in Chip and PIN as a far more secure authentication method than a signature, the idea of no authentication was bound to raise questions. The stories of a fraudster walking around busy subway trains with a POS terminal simply clocking up phantom sales proliferated and never really went away.

To combat this, the consumer was reassured by limiting the single transaction value and including a maximum accumulated value on contactless transactions before a PIN must be used. It worked, with consumers adopting the product and contactless fraud hardly registering. In other words, the potential value of a card to a fraudster wasn’t enough to drive any significant increase in contactless card fraud. On this basis, it seemed reasonable to raise the limit to £45, in April 2020, and now to £100.

The Covid-19 mask

With the most recent increase in both single transaction value and total accumulated limit (before a PIN transaction is required), the contactless boundaries have been increased significantly. Does this change the game for fraudsters? Judging by the response of the BBC, it has certainly resurfaced those long-held, underlying security concerns of consumers.

The justification of these rises is in part down to the previous limit rise to have no corresponding increase in contactless fraud. In fact, UK Finance has reported decrease. However, there is a real concern that these results have not been based on the experience of the real world, they’ve literally been masked by Covid-19. With society largely in lockdown and socially distancing for much of the period since the increases, the opportunity to steal or skim cards has been all but eliminated.

A lack of attention on a busy train, an unattended wallet, a card dropped accidentally, etc. have all been fraud scenarios that have drastically reduced, thereby, cutting the fraudster’s opportunity. Only time will tell whether the £300 accumulated limit will be enough to put fraudsters off but in any event, there is a need to address the consumer confidence issue.

Moving ahead with Biometric Payment Cards

The obvious way to get all consumers embrace this new contactless limit with confidence is to introduce a strong authentication for contactless card payments. Whilst some will argue that mobile payments will do this, it ignores the fact that most consumers prefer to use a physical card when shopping in-store and will continue to do so for the foreseeable future.

The answer is the biometric payment card, a technology that has come of age at the perfect time. Biometric Payment Card merges the established payment card and infrastructure with biometrics, in this case using fingerprints. Whenever the card is used, consumers simply hold the card using their registered fingerprint and they are authenticated – it couldn’t be simpler. With this product, not only are the security concerns addressed but the opportunity to eliminate transaction limits, whilst never needing to touch the POS again, becomes a reality.

Moving ahead, issuers need to act now to drive confidence and build the success of contactless payments during the past year by responding positively to consumers’ security concerns. How do they do that- Biometric Payment Card is the answer!

To know more about biometric payment cards, get in touch with us here