Money & Rights

Go contactless- safely

Contactless payments are now widespread, but how safe are they? Asks Marianne curphey

If you've received a new card from your bank recently, you'll notice it had a contactless symbol on one edge. this applies to credit cards as well as debit cards, and means you can use your card at certain kiosks just by tapping your card against the terminal,, without the need to key in your pin number.

Contactless payments are now widely accepted in shops, coffee shops, transport hubs and other retailers. However, not all terminals that accept card payments have moved over to contactless technology yet, so you may still have to input a PIN number in some shops, even if you have a contactless card. Although this makes transactions quicker and easier, not everyone likes the idea of a card that can be used without any need to identification.

Here we look at how they work and how to use them safely.

Contactless payments on the increase

In the UK, the number of contactless debit cards has continued to grow strongly. Most banks now provide contactless cards as standard. According to data reported to the UK Cards Association, the number of contactless debit cards had grown to 73 million, accounting for 67 percent of all contactless card in the UK. Currently 73 percent of debit cards in circulation are now contactless, up from 61 percent only a year ago.

Spending limits

You can use contactless for purchases costing £30 and less; more than £30 and you will still have to use your PIN. Not every shop or other retail outlet will have upgraded to contactless terminals, so you might have to put your card into the terminal and key in a PIN number even if you have a new contactless card.

It's not jst your credit or debit card which you can use without a PIN number. Contactless payments are becoming increasingly common on a range of devices including: Pre paid, debit, charge and credit cards, key fobs, wearable devices and mobile devices.

How do they work?

The contactless device contains an antenna so that hen it is touched against a contactless terminal, it securely transmits purchase information. This is the case for all types of contactless payment, including smart phones. You don't need to activate your contactless card. The technology is buolt in your debit or credit card is ready to use as soon as you have signed it.

What are banks doing to protect us?

Banks and card companies use complex software which builds neural networks around credit and debit card spending to try to distinguish between fraud and genuine spending, says Martin Warwick, security expert with data analytics company FICO.

Sophisticated computer programmes look for patters in the way you use your card.

"If you visit three or four ATMs in a row, that would flag up as suspicious and would score highly, and the bank would most likely contact you," he adds.

Each customer had their own 'behaviour profile' which is updated with every transaction and enables your spending behaviour to be analysed and modelled. Any usual transaction will be flagged up and the software will send an alert to question whether someone other than you is using your card. That might mean your card is declined in a shop, or you receive a call from your bank asking if you have your card in your possession.

The UK Cards Association says contactless cards and devices only work within just a few centimetres of the terminal, making it virtually impossible for any details to be intercepted while in use. Any data obtainable from a contactless card is visible on the front of the card and would be of limited use to a fraudster. The visible details could not be used to make a cloned card.

If your card is lost or stolen, as long as you report it ti your bank as soon as possible in accordance with their terms, you won't have to pay for any fraudulent use.

Is there a limit on how many times I can use it?

There is no daily limit, but there is a limit of £30 per transaction, and you'll periodically  be asked to enter your PN. Your bank decides how often this will happen.

If you make a number of contactless payments in quick succession, you will probably be asked to key in your PIN number after a certain number of payments or when a certain financial threshold is met. This is set by the card provider and varies from bank to bank and is designed to protect you from fraud.

How long does it take for a payment to leave your account?

This also varies from one bank to another, and also what time of day you make the payment. Sometimes it will appear on your statement and be debited from your account the next working day, but it could take four days to show up.

Can you make a contactless payment with an empty account?

You may be able to, depending on what type of account you have, but you may end up with unauthorised overdraft charges or charges for breaching your credit limit. Although it is possible to make a contactless payment when you are overdrawn, it is best to check your bank's terms and conditions.

Can I turn off the contactless function? 

You cannot switch off the contactless technology. If you choose not to use contactkess, you can pay with Chip and PIN instead.

Can I make multiple purchases by mistake?

Terminals are designed so that they do not accept more than one payment from the same card at the same time. However, it's a good idea to keep an eye on your account, and pay attention to even a small payments on your statement.

The UK Cards Association says criminals can't hang about using a card reader in the street or on a train in order to take a payment or suck cash from passers-by holding contactless cards. It says there has never been any verified report of this happening in the UK.

And as they only work a few centimetres from the card machine, there's no chance you could end up paying for someone else's shopping while you are standing in the queue.

What if I think there is a problem with the way my card has been used?

If you think your card had been used fraudulently, you should tell your bank or building society immediately and report it to Action Fraud.

Do you use a contactless card? Are you more skeptical of them?

Let us know what you think and share your experiences with us and others. Just follow us on Facebook, Twitter, Google+, Instagram and YouTube

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