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  • Contactless Cards: All You Need to Know

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  • You have heard of swiping your credit card (when the magnetic stripe is passed through a card reader), you have heard of dipping your credit card (where the chip is inserted into the card reader), now get ready to tap your credit card.

    That’s right. Thanks to contactless credit cards, you can ow just tap your card to a point of sale machine, and the transaction is complete.

     

    What Is a Contactless Credit Card?

    If your credit card has a symbol on it that looks like the ‘wifi’ symbol, then you own a contactless credit card.

    These cards help you make payments without having to physically swipe or dip the card. All you have to do is tap the card against the card reader (the card reader also needs to be enabled for contactless payments), and the transaction is complete.

    It provides convenience and prevents you from having to stand in long queues to make a payment.

     

    How Does a Contactless Credit Card Work?

    Contactless cards use a technology called bear filed communication (NFC). NFC uses magnetic field induction to enable communication between NFC devices when they are brought together or within a few centimetres of each other.

    Moreover, each card comes with a contactless chip and an antenna known as the radio frequency (RFID) antenna. So, when you wave your card over a contactless terminal, the radio frequency (along with a one-time code) help you complete your purchase.

    Additionally, since you don’t have to enter your PIN for transactions below Rs.2,000, this form of payment is usually completed within a few seconds.

     

    Are Contactless Credit Cards Safe?

    The question that now arises is with regards to the safety of contactless cards. If you don’t have to swipe or dip your card, what are the chances that you walk past a contactless card reader and it (without your knowledge) deducts money from your credit card?

    The answer to this question is simple. This won’t happen. It won’t happen because of the different layers of security that go into a contactless card.

    In order to better understand how safe contactless cards are, let’s take a look at some of the common myths and the actual truth.

     
    Myth 1: A thief can make transactions with your card, without it leaving your pocket and without your knowledge.

    Truth: For a contactless transaction to take place, the credit card and the reader need to be at least two inches away. So, the chances of this happening are extremely slim. Moreover, if you do find that you have been wrongly charged, you can always raise it with your card issuer. This way you will not be held liable for the transaction.

     
    Myth 2: All your information is transmitted to the merchant when you use a contactless mode of payment.

    Truth: This is actually far from the truth. When you make a contactless payment with your credit card, information such as your name, your billing information, or your CVV are never transmitted to the merchant. Instead, only your account information along with a one-time password or code is sent from the card to the reader.

     
    Myth 3: A person may mistakenly be charged for a purchase even if they just walk past a contactless terminal.

    Truth: Unless the contactless machine has been tampered with, it is highly unlikely that you will be charged just by walking past a machine. Moreover, you can place your card in wallets or cases that provide contactless protection for additional safety.

     
    Myth 4: You can be charged twice for the same transaction without your knowledge.

    Truth: This cannot happen since each contactless transaction requires you to tap your card or be within a few centimetres of the card reader. In addition to this, a one-time code is transferred from the card to the reader for each transaction. Moreover, contactless point of sale (PoS) readers allow only one transaction at a time.

    So, it’s quite clear that most fears that surround contactless credit cards are unfounded and they are safe to use.

     

    How to Use Contactless Credit Cards

    As mentioned earlier, using a contactless credit card is extremely simple. There are three steps that you need to follow:

    • Look for the contactless payment symbol at checkout.
    • Tap your card on the machine (in most cases, you don’t even have to hand your card over to the merchant. As such, you end up having complete control over your card).
    • Once the machine beeps or a green light is seen, it means that your transaction has been successful and you can go on with the rest of your day.
    • If your transaction amount is greater than Rs.2,000, you will need to provide your PIN for the transaction to go through.

    Note: According to the RBI, transactions below Rs.2,000 do not require you to provide your PIN.

     

    5 Best Contactless Credit Cards

    At present, there are over 20 million contactless credit cards in circulation in India and the numbers are expected to grow. So, how do you decide which contactless credit card you should go for? While contactless payments work the same way on all credit cards, here are cards that offer contactless payments along with other features that you can consider:

    1. HDFC Regalia First/Regalia Credit Card:
    2. The Regalia First and Regalia Credit Cards offered by HDFC are enabled with contactless payment facility. Since both of these cards are travel credit cards, you not only earn points that can be redeemed for vouchers, but the contactless system helps you while you are travelling abroad. Especially if you have to travel by bus or other forms of public transport which require you to use a contactless card.

    3. SBI Signature Contactless Card:
    4. When a card has the term contactless in its name, you know that it should be on the list of contactless credit cards to consider. Along with the points you earn on your daily spending, this card provides you with the convenience of contactless payments. So, your wait at checkout is cut down to just a few seconds.

    5. ICICI Bank Coral Contactless Credit Card:
    6. Using this card for contactless payments will enable you to get free movie tickets as well as discounts on dining.

    7. Kotak Royale Signature Credit Card:
    8. This credit card comes enabled with Visa payWave, Visa’s contactless payment facility. You also end up earning rewards on all your spending, making this a good option for those of you looking to travel.

    9. Citi Cash Back Credit Card:
    10. Along with earning up to 5% cash back on your spending, this Citi card also allows you to make contactless payments which are secured by the Visa or Mastercard network. This means that not only do you get to save on your daily transactions, but you get to do it without your card leaving your hand.

     

    Benefits of Using Contactless Cards 

    Now, that you know quite a bit about contactless cards, here are some of the other benefits of these cards to help convince you to apply for one (if you aren’t already convinced): 

    1. No credit card skimming:
    2. Card skimming is the easiest way for fraudsters to get your card details. Your card information is usually taken by these fraudsters when they take your card to swipe it or dip it in the card reader. This is entirely minimised with contactless cards since it doesn’t leave your hand. 

    3. Additional layers of security: 
    4. As mentioned earlier, contactless payments are quite safe. Moreover, even if your card is tapped or waved multiple times, the security measures in place ensure that there are only a minimum number of transactions that can be made before you will be required to enter your PIN.

    5. Protection from fraud: 
    6. If a fraudulent transaction is made using your card, you don’t have to worry since you will not be liable for those transactions. Almost all banks provide you with 100% liability cover.

    7. Shortens your wait time: 
    8. With a contactless credit card, you don’t have to spend time at checkout waiting for the merchant to swipe or dip your card, enter the amount, request you to enter the PIN, and then approve the transaction. All you have to do is tap the card to the reader, wait for it to beep or turn green, and you are good to go.

     

    What Else You Need to Know: Frequently Asked Questions

    1. Why should I use contactless?
    2. Contactless as a form of payment is generally more secure since you don’t have to hand the card over to another person. Moreover, it helps you save time since payments involve just tapping the card reader and waiting for the beep or the green light to appear.

    3. Where can I make contactless payments?
    4. You can make a contactless payment at any terminal or point of sale machine where the contactless symbol (wifi symbol) appears. At all other terminals, you will have to either swipe or dip your card and enter your PIN to complete your transaction.

    5. How do I pay with Mastercard contactless or Visa PayWave?
    6. To make a payment with Mastercard contactless or Visa PayWave, you need to just tap your card against a contactless-enabled terminal or wave the card around 4 centimetres from the terminal. And that’s it. You know your payment is successful when the terminal beeps or a green light appears.

    7. How close does the tap have to be to the reader?
    8. Your card has to be a maximum of 3 inches from the reader for your transaction to go through. If you are tapping the PoS terminal, you need to tap it lightly and, in most cases, only once.

    9. How will I know if my transaction has been successful?
    10. Once you tap or wave your card against the reader, wait until it beeps or turns green. This means that your transaction has been successful. Depending on which bank’s credit card you are using, you may also receive an SMS that your transaction has been successfully completed.

    11. What if my contactless credit card is lost or stolen?
    12. Like with any credit card, if your contactless credit card is lost or has been stolen, please block the card immediately. You can do this by contacting your bank’s customer care centre or by any other method provided by your bank.

      

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