A Comprehensive Guide on Contactless Credit Cards

Did you ever imagine that technology would advance so much that you would be able to make card payments without swiping or punching them? Contactless credit cards are revolutionizing India’s payment system. You can make payments without entering any PIN. You just have to tap or swipe it at a close range in front of a contactless credit card terminal or POS machine to authenticate transactions. Contactless usage of credit cards is convenient and secure.

Contactless cards meaning

Contactless credit cards are built with magnetic tape, a technology-embedded chip, and a Wi-Fi symbol. It allows you to make payments over a secure interface. The Wi-Fi symbol enables you to pay without swiping or punching your PIN. Since you do not have to enter your PIN or hand over the card to the cashier or merchant, it is safer than cards that require you to enter a security code. The entire transaction takes around 3 to 5 seconds, so it is a lifesaver for busy officegoers or anyone in a rush.

With the Reserve Bank of India fixing contactless payment limits, also called Cardholder Verification Limit (CVL) to protect the issuers from fraud, contactless card payments have become more secure in recent times. The RBI has fixed a limit of INR 5000 to protect your interests as a contactless cardholder. If any fraudulent activity takes place, the issuer has to pay the damages.

How do contactless credit cards work?

Tap-to-pay transactions work using radio waves. Upon waving your contactless card near the card reader (on a close range of 2 inches), an antenna reads your card’s signals and transfers your information to the POS system. The transaction is completed by virtue of Radio-Frequency Identification (RFID).

Some business owners offer smartphones built with Near Field Communication (NFC) technology to process contactless payments. The process remains the same, with the smartphone detecting your card’s presence, using an antenna to process the card’s information, and completing the payment when you tap on the smartphone screen.

Some contactless EMV cards contain a magnetic strip as well as the standard EMV chip. Depending on the merchant’s interface, you can either enter your PIN or just tap it to finish your payment.

Benefits of using contactless payment cards

  • Your card information is secure

You do not have to hand over your contactless card to any merchant or enter your card information in front of someone. You just have to tap the contactless system or wave it from a close range, and the system will read your card’s information and complete the payment.

  • Guarantees protection from fraud

Contactless cards guarantee 100% liability coverage. If you find that fraudulent transactions have been made with your card, you have to contact the card company and they will block your card right away. You will get most, if not 100% of the stolen money back if you report the fraud to the lending institution immediately. You also have to file a police complaint and submit the acknowledgement to the card company. There are other security measures in place to limit fraudulent transactions like there is a daily limit of up to 5 transactions on your contactless cards and you can only use INR 5000 at a time.

  • Saves time

Contactless card payments take only about 3 to 5 seconds. It saves you a lot of time and energy, which you would otherwise spend swiping and entering your PIN.

  • Adds a layer of security

You do not have to enter a PIN or swipe your card so your card information remains secure. You do not even have to hand your card to the shop owner or the merchant. Contactless card systems scan your card’s data with only a tap or wave done from a close range. Also, POS readers only allow one transaction at a time. Even if you accidentally wave or tap your cards multiple times and your money gets debited, you can always raise this issue with your card company.

Are contactless payment cards safe?

Contactless credit cards are safe, convenient, and accessible. There is no chance of your credit card information being skimmed, as no merchants will be directly handling your card. The tap-to-pay mechanism keeps your card details safe and secure. Also, the transaction limits set by the Reserve Bank of India add another layer of security. If you have full insurance coverage by your card company, you will be reimbursed most if not the entire amount, in case your card is used for fraudulent transactions.

Nowadays, contactless cards have gained popularity because of their safety and accessibility. As some merchants may not have made the switch to contactless payment systems, you can use contactless cards by entering the PIN and swiping it as well. Make sure that your card has an EMV chip as well as a Wi-Fi symbol when you issue it. For more information on contactless credit cards and to apply for one, head to ApnaPaisa.



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