Contactless credit cards, as well as contactless debit cards, allow users to perform fast on-the-go transactions with a simple wave or tap on devices such as contactless-enabled card readers, mobile phones, and fobs.
According to ABI Research, contactless cards issuance accounted for about 1.5 billion units in 2018 or over 50% of all payment cards issued globally, and they are expected to grow to 2.3 billion annually by 2022.
You will know whether your card is contactless or not by observing the EMV Contactless Indicator on the back or the front depending on the issuer, while contactless-enabled readers are recognized due to the presence of the EMVCo Contactless Symbol.
Contactless credit cards use EMV and near-field communication technology (NFC) technology and have an RFID antenna to communicate with NFC-enabled devices, which also have RFID antennas to facilitate communication.
EMV contactless credit cards are secure for payments. The card must be at least 4 centimeters close to the checkout terminal to be charged. The EMV NFC chip generates a one-time code (or token) that protects the data on the card. Even if a user accidentally taps twice on a payment device, there will be only one charge.
EMV chips were developed initially for Europay, Mastercard, and Visa, but are now used by most payment cards around the world. NFC-enabled EMV cards are not popular all over the world due to some security concerns. The RFID antenna makes the cards susceptible to fraudsters who use RFID skimmers to steal the data – usually, just the card number and expiration date, which are useless without the name of the owner and address associated with the card. Still, to prevent such issues, you can protect your card in an RFID-blocking wallet or by wrapping it in aluminum foil. Despite concerns, “fraud on contactless cards and devices represents just 1.1% of overall card fraud,” per Financial Fraud Action UK.
Contactless cards have significant benefits if you use them for daily expenses. They improve efficiency at the point-of-sale as they speed up the transaction, offer loyalty points or rewards depending on the issuer. Since the card remains in your hand, it’s less likely to forget it at the cashier.
For vendors, contactless cards improve operations, as contactless transactions are faster than cash and conventional card transactions, averaging, according to First Data, “12.5 seconds, compared to 26.7 seconds for conventional card transactions and 33.7 seconds for cash transactions.”
Due to these benefits and ease of use, contactless cards will become increasingly popular in the future.