The reliability of contactless cards has been brought into question recently following some Marks & Spencer customers experiencing duplicate transactions, or ‘double dipping’. Whilst at the till and preparing to pay with another means of payment, the customer’s contactless cards have connected with the reader and authorised the transaction.
As a fairly new technology, customer and retailer education is still in the early stages and therefore, rather than being technical issues causing the double dipping, it’s far more likely to be human error.
Some of the Marks & Spencer customers suggest that contactless card payments have been taken from their cards when they were 40cms away from the reader. This isn’t technically possible as contactless cards can only be ‘powered-up’ at a distance of 3-4cm, in a similar way to Oyster Card technology. It’s likely that customers may have unintentionally been charged through the terminal either being at waist height or their bag or purse being placed on to or next to the reader whilst they retrieved their Chip&PIN card.
Recent research by the UK Cards Association indicates that this type of incident only occurs in an estimated one in five million transactions, suggesting that it’s more a case of greater customer education needed than the technology being at fault.
What people don’t realise is that contactless payments are actually more secure than ATMs or point-of-sale machines. Bogus ATM and point-of-sale machines account for a significant amount of payment card fraud because they have the ability to capture the user’s PIN and card details once entered. This opens the consumer up to multiple fraudulent activities, often which they’ll only become aware of once the fraud has taken place.
Furthermore, there has been an increase in the number of cards stolen recently, with Financial Fraud Action UK reporting that there were 7,525 incidents in the first four months of the year, compared with 2,553 in the similar period in 2012. This practice, which has been labelled ‘shoulder surfing’ by the police, consists of thieves looking over a person’s shoulder while they are at a cash machine entering their PIN and then distracting them and snatching the card.
Payments via mobile phones, through a mobile wallet, counters against such fraud as it requires the user to enter their card PIN into their own phone. This provides a more personal experience which may be a comfort to consumers, delivering the added security of entering their PIN into their own device, as opposed to a public one. If consumers are educated and diligent about the security of their phones, then NFC is a safer payment option.
The biggest barrier to adoption of contactless payment is not the security, but rather the lack of education and userability. Many consumers do not know whether they’ve got a NFC enabled device and not all retailers have educated their staff to provide proper support to customers. Only by increasing awareness and knowledge of the technology can people really take advantage of the convenience and added security it offers.