Contactless payment overtakes smart cards

Contactless payment is growing exponentially in Europe. Almost one in two transactions are now tap-to-pay in the EU. MasterCard estimates all payment terminals in Europe will have contactless support in two years’ time.

–In all transactions from transportation to brick and mortar the queues to the till will move faster and the risk of misuse of PIN numbers will decrease. This is a welcome change, says Jaakko Turunen, Sales Director at Poplapay.

In some cases the PIN code can be detected during payment in for example a restaurant or at the cashier in a shop. The card is then snatched or duplicated and cash withdrawn at an ATM.

–The less frequently the PIN number is used, the fewer the chances of getting scammed become, explains Marko Hartoneva, Development Director at NETS.

A payment card issuer, a bank or credit union, can determine when the PIN number is required. For example until now, a certain number of contactless payments can have triggered a PIN code request, but with increasing floor limits, the PIN may be required more frequently. The card issuer can determine the terms by card type or even by customer profile.

Safe, quick and practical

When contactless payment was introduced, many feared scammers could charge contactless enabled cards through clothing or bags in the stealth of a crowd. In practice it’s not that simple.

–It’s not enough for a scammer to have a mobile payment terminal. Every transaction needs to be submitted to the service provider and the credit chain for access to the money. A criminal would then need to have an active subscription and agreement with a service provider, such as NETS. Every applicant is screened and the transactions are monitored, Hartoneva explains.

Around 45 % of all transactions currently processed by NETS are contactless. The share of contactless payments on Poplatek’s payment terminals is around 30-35 %.

– Consumers have clearly adopted contactless payment and it’s viewed as quick and practical, says Hartoneva.

According to MasterCard contactless payment has already risen to more than 50 % of all transactions in many EU countries.

Hartoneva is positive contactless payment is the future:

– Finland is raising the floor limit of contactless payment from 25 € to 50 € in April 2019. In countries with high card payment rate the floor limits have already been increased, or there’s an active discussion about doing so. The trend is towards higher limits and higher adoption everywhere.

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