Everything You Need To Know About Contactless Payments. In this article, there is everything you need to know about contactless payments. Many users usually go online simply searching for this information, but unfortunately, they don’t even get it, because the information isn’t resourceful.
But today here is reliable and resourceful information. Only if you read further will you get to understand what it all means.
Everything You Need To Know About Contactless Payments
Contactless payments simply allow you to be able to make purchases without even coming into contact with credit card terminals. Many grocery stores, restaurants, fast-food chains, and even some public transit systems in select cities now accept contactless payments—along with some ATMs.
More customers are even using contactless payments since the global health crisis began, according to 27% of small business owners surveyed by a payments industry consulting firm. According to a MasterCard survey, three-quarters of those surveyed say they will simply continue using contactless payments in the future.
What Are Contactless Payments?
Contactless payments can simply be made with a contactless credit card (sometimes called a “tap to pay,” “tap to go,” or “tap and pay” card). You can even make contactless payments with a phone or watch’s mobile wallet, which then simply holds your credit and debit cards. Contactless payments are also generally for in-person purchases.
There are even a few types of contactless payment systems. With mobile wallets, the contactless payment symbol’s graphic of four curved lines will then likely appear somewhere on the card or contactless-enabled credit card terminal.
Your card, watch, or phone should then usually be within 2 inches of the terminal, and even some terminals require you to then tap your card or hold it in place for up to two seconds. But if you accidentally touch it twice, you shouldn’t be charged twice.
A tiny antenna inside your phone simply sends a one-time “token” or unique identifier only usable for one transaction (not the actual number) to the payment terminal. Light or sound then typically confirms that the purchase went well or went through, and then deducts money from your account.
This process happens quickly—up to 10 times faster than a standard transaction.
Other types of contactless or touchless payment apps use a scannable code for the checkout—Starbucks and Walmart apps are two examples. These codes only work inside the retailer, not for other purchases.
Contactless Cards vs. Contactless App Payments
Which method of payment is right for you? You can simply use both a card from a mobile wallet and even a physical card, depending on the circumstance.
Contactless debit and credit cards are the most popular and widely used types of contactless payment. Typically referred to as “Tap to Pay” cards, these devices simply look like regular cards from the exterior but inside contain a small antenna that will allow wireless communication with a reader.
These cards also typically come with a magnetic stripe and chip, so a card can still be used in more traditional ways if a store does not have a contactless-capable card reader.
Tap-to-Pay cards have since undergone rapid growth in only a few years. In Europe, contactless payment has nearly become standard, with the majority of new cards featuring the service. In the U.S., adaptation has been even slower, but its prevalence continues to grow.
Since 2019, all Chase Visa cards have then been equipped for contactless payments. American Express and also Capital One have also offered contactless cards for some time now. Some other U.S. issuers that even offer the service include Bank of America, Citi, Discover, and Wells Fargo.
The contactless infrastructure simply brings more options to the table. In 2018, a study showed that 95% of new point-of-sale terminals are Tap-to-Pay enabled.
Contactless Card Payment
Plastic credit and also debit cards with built-in contactless technology do not require setup, and all four of the major networks (Visa, MasterCard, Discover, and American Express) issue contactless cards.
The four curved-lines symbols on the card simply indicate it can then be used for contactless transactions. If you are still unsure, check with your credit card issuer to learn whether contactless cards are available and order a card.
One of plastic’s big benefits is if a store does not then accept contactless payments, you can then still swipe your card or insert it. The downside is that you still need to carry the card around.
Contactless Payment with an App
You can then leave your wallet at home and also pay by holding your phone near a payment terminal.
Mobile wallet apps: With a payment-enabled smartphone or wearable device, you can simply be able to load multiple cards and also set a frequently used default card in your mobile wallet app. With some, you can even withdraw money from an ATM—as long as the ATM supports contactless transactions. Mobile wallet apps include:
- Apple Pay is for iPhones and Apple Watches.
- Google Pay is available on Android phones and watches.
- Samsung Pay is for Samsung phones.
- LG PayQuick is a contactless payment solution for LG phones that also works with magnetic readers.
- Garmin Pay is for Garmin smartwatches.
- Fitbit Pay is for Fitbit smartwatches.
Retail apps: Some of the retailers also have their own contactless apps that will allow you to pay at checkout with a reloadable gift card, or your credit or debit cards. Two examples:
- The Starbucks App, which works on a variety of devices, including Fitbit watches,
- Walmart Pay within the Walmart App, for Apple and Android.
Smartphones and even smartwatches offer an additional level of security for contactless payments. Your unique Face ID, PIN, or fingerprint is simply required to unlock the device and even allow you to make secure payments and provide protection against fraudulent card use.
Contactless app drawbacks include:
- Some merchants do not accept contactless payments, and also, if you only have your smartphone or watch, you can simply get stuck somewhere without a payment method.
- You should also take the time to set up your mobile wallet and even load your cards before using the wallet for the first time, and it can then take time to unlock a watch or device with a PIN at the register.
- Some corporate and business card issuers restrict which cards are allowed to be loaded; for example, only business debit cards are allowed.
- Some retail apps only permit the ordering and also paying ahead of time, not in-person checkout.
Credit Cards and Mobile Wallet Rewards
Contactless purchases can then continue to earn rewards offered by your credit card program, just like a traditional stripe-and-swipe card. If you are using a mobile wallet, you will then need to select the card that rewards the purchase type you are simply making, especially if it’s not your mobile wallet’s default card.
Some of the rewards credit cards even offer increased rewards for contactless payments.
Some mobile wallets might then also offer rewards, at times. For example, Samsung Pay rewards some users simply based on the number of qualified transactions made using eligible cards.
How Does Contactless Payment Work?
Contactless cards can then simply work a lot like mobile wallets. The transaction is also then completed by simply holding or tapping the card on a contactless-enabled card reader. It’s up to 10 times faster than swiping, inserting, or using cash. Plus, it also keeps your info secure and your hands off the card reader.
Do I Get Charged For Using Contactless?
The transaction fee is then charged on payments using methods such as debit cards and is usually a specific percentage of the cost of the transaction. For example, one provider might then charge a transaction fee of 0.6% of each transaction and an authorization fee of 4%.
What’s the Limit on Contactless?
There is no daily limit for contactless payments. However, from time to time, when you shop using contactless payments, you will then need to put your card into the machine and also enter your PIN to verify it’s you before you can use contactless again.
What Happens If You Have Two Contactless Cards In The Same Wallet Purse?
If someone then has two contactless cards in the same wallet/purse, it can also confuse the terminal reader and even sometimes result in the customer paying twice. To prevent this from happening, it is then best to take the card out and also wave it in front of the reader.