Could you imagine something easier than swiping or inserting your card for paying? Contactless payments are the answer! They literally allow you to pay by tapping your card. Sounds cool, right? Let’s find out more about them:
What are contactless payments?
Payments made by just waving or tapping your card, smart-phones, wearable devices or sticker at a POS machine. ICICI Bank was the first one to introduce such cards in India in 2015: They were called ‘Coral Contactless Credit Card’ and ‘Expressions Wave Debit Card’. Now SBI, HDFC, Axis, ICICI and few other banks also issue such cards and you can use them to pay at supermarkets, dining, entertainment venues and retailers such as Big Bazaar, Future Bazaar, Dominos, etc.
How do these work exactly?
These cards work on *technical stuff* *yawn* : near-field communication (NFC) technology, which uses radio transmission to establish contact when the cards are near a POS terminal.
Basically a technology that allows a person to simply pay by tapping or waving their card near such a terminal, (like you use your hotel key card) and your transaction will be done. These cards can also be used in the traditional way — by swiping or dipping.
Your card will look normal but inside it there is an antenna and chip which enabling the tapping facility against the reader or terminal. Nowadays apart from cards you can also wave your smartphone to pay because most of them are embedded with NFC- near-field communication. For e.g. SamsungPay
Why use them?
Because of the 3 S’s : Speed, simple and secure:
1. Speedy: You’d take around 30 seconds to pay at a counter with cash including the time taken to pull out money from your wallet, look for change and ensure the money is back in. But with contactless payments you’ll take about three seconds to do the same thing including the time to pull out your wallet which contains your contactless card, tap against the terminal and tuck it back in.
2. Simple: It is literally as simple as saying hello to your friend.
3. Secure: People are afraid of fraudsters stealing their card information through hidden machines. But for a payment to go through the customer has to be very close (less than 4 cm) to the fraudster’s gadget for his information to be read. And even with such proximity all they can get is the card number and expiry date which isn’t enough for a successful transaction.
Apart from that if there is a powerful card reader around you it is very difficult for the reader to copy the card information. Contactless cards work on a concept called ‘load modulation’, and this modulation is so small that a heavy reader isn’t sensitive enough to get your information correctly.
As for contactless payments through your phone, they will get activated only when you want them to. Example: It will turn on when you checkout at a retail store’s contactless POS machine. Also there is no chance by which you pay the transaction twice and if you accidentally tap your card twice for the same transaction you will be charged only once.
Currently in India the limit for contactless payments is only Rs. 2000 per transaction, anything above that can be done through the traditional method of swiping or dipping your card. The main reasons for this is the security concern faced by some countries where people’s information has been stolen. But then, experts say these threats are present even in the regular cards. Whats your take on this?