Contactless card means a card that allows payment without a PIN or swiping. You just need to wave the card in front of the POS machine to make payment using a contactless card. These types of cards can speed up the shopping experience as well as provide security against card cloning.
Before few days, I went to shopping in D-mart to buy some household items. At the payment time, I have handed over my ICICI Corel credit card. I was waiting for the counter boy to provide POS for entering a PIN. However, the counter boy has just tapped the card on the machine and payment was done. He provided an invoice for the good purchase. The payment was done here using contactless technology. I was wondering if payment can be made without entering the PIN if a card is lost it can be misused and payment can be done just by waving the card. I decided to check with the bank. Bank responded with an answer that it is contactless card and you can perform up to Rs.2000 transaction using the contactless method without entering a PIN. This is as per RBI guideline. If you want to perform transaction above Rs.2000 you need to enter the PIN after swiping the card. In this post, we will explore the contactless card along with advantage and disadvantages.
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What is Contactless Card?
Contactless card means a card that allows you to make a payment just by waving a card nearby POS machine. This card can be identified by the wave symbol . If you find this symbol on your credit card or debit card it supports contactless payment. These cards are based on NFC (near field communication) and RFID (radio frequency identification).
Contactless cards are very useful for making faster payment at crowded places like a petrol pump, shopping malls, movie theatre and fast food parlor where the payment amount is less. This card is also useful for old age people where they are not required to remember the PIN for making payment. Contactless payment offers a similar level of security as chip and PIN payment.
These types of card are generally offered by VISA and MasterCard. VISA calls this technology as payWave and Mastercard calls it PayPass.
How contactless card works?
The use of a contactless card is very easy. This card contains a chip and an antenna when you place this card near proximity of POS, the antenna inside card get electrically activated and start communication with POS. Steps to use the contactless card while making payment are given below.
- Look for the wave symbol (wifi logo) at the Point of Sell (POS) machine while making a payment at merchant’s place.
- Enter your purchase amount into POS terminal or ask counter boy to do the same. The amount should be less than Rs.2000.
- Tap the card near contactless reader or at the POS. It will work only if it is closer than 4 cm.
- Once the transaction is complete you will see green light along with beep sound. Few machines also display text “Transaction Approved” on the POS machine
- If the amount is greater than Rs.2000 you need to enter a PIN in order to complete the transaction.
Contactless Cards in India
The contactless card technology is not new in India. It was introduced four years back in India. However, most of the people are not using this method in India. This may be due to unavailability of NFC enabled POS at merchant end or lack of knowledge about this technology. Whatever be the case one thing is sure that as the government is pushing digital payments, the usage of these types of card will grow in the future. Most of the banks have started issuing or replacing debit card and credit card with contactless technology. Few popular contactless credit cards in India are –
- ICICI Bank Coral Credit Card
- SBI Simply Click
- HDFC Regalia Credit Card
- Standard Charted Platinum Card
FAQ on Contactless Cards
Contactless Cards are safe and secure?
As per experts, these types of card are as secure as chip-based cards. These types of cards carry multiple layers of security and it ensures that consumer is safe against the fraudulent transaction. The contactless payment terminal can process only one transaction at a time so, the chance of cross payment or duplicate payment is NIL.
What are the advantages of using contactless payment?
It is very easy and convenient to use contactless payment method. You just need to tap your card. It does not require entering PIN or signature. Thus payment processing is faster. The chance of misusing your card through cloning would be minimized using this technology.
What are drawbacks of using contactless card?
One of the biggest drawback of this card is if card is lost or stolen, someone will be able to use it for contactless purchase up to Rs.2000. If this card is placed near proximity of any authorized machine or POS without your information fraudulent transaction can take place.
Can I use contactless card for shopping if bill amount is more than Rs.2000?
Yes, you can make use of your contactless card for the shopping for the bill amount more than Rs.2000. You need to input your PIN in order to authorize the transaction.