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By Reno Charlton
Staff Writer
8 July 2008
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A new contact-less payment credit card was introduced in the latter part of last year - while offering ease of use and quick convenience for hectic-lifestyle Londoners, people have begun to start asking "just how secure are these payments?"
There are plans for nationwide coverage, but as yet the new payment systems have only been introduced in London. For obvious reasons, London is a great place to test-drive the new system, and it will most likely be of greatest benefit to people living in the smoky-city.
The new contact-less payment system
Visa and MasterCard both offer varying touch-less payment systems. Visa's system is named payWave and MasterCard has followed suit with a closely named PayPass system.
The touch and go technology of these payment systems offers increased convenience and ease of use for cardholders, and after its initial launch the new system has received some pretty positive reviews from Londoners using the cards.
Both Visa payWave and MasterCard PayPass imbedded credit cards can be used to make payments of up to £10 at various retailers and businesses, such as in pubs, for fast food, and even for taxi fares, providing the business has one of the special readers installed.
No signature is required to make the payment and no PIN is required, enabling people to enjoy increased speed and convenience when making payments.
The actual technology used is radio frequencies, and the specially imbedded payWave or PayPass credit cards communicate wirelessly with the reader to transmit details to process the transaction.
For cardholders all that's required to make a transaction is simply to hold the credit card at least 3 centimetres in front of a payWave / PayPass reader, the reader then signal authorisation of the purchase visually and audibly. You can ask for a receipt - or you can dash away to catch your departing train or tube.
How secure are contact-less payments?
A survey was recently carried out with regards to the effectiveness and safety of the new payWave and PayPass credit cards.
Whilst many people said that the payment cards did offer increased convenience and ease there were also concerns that they could potentially lead to an increase in fraud and card related crime.
Over two thousand people were surveyed with regards to the new 'touch and go' cards, and out of these nearly 80% said that they were concerned about the possible breaches of security that could come about as a result of the new payment process.
Out of those polled as part of the survey around 50% thought that the 'touch and go' cards would lead to an increase in card related crime levels, with many concerned that lost or stolen cards could be easily used by fraudsters as a result of no signature of PIN being required for transactions to be made.
Over 30% of respondents were also concerned that fraudsters may be able to use the cards to hack into more detailed account information.
Cause for concern?
While people may be sceptical about this new technology, it's clear that people should not be worried as credit card providers are offering protection against any 'touch and go' fraud.
While the exact level of fraud protection will vary between credit card issuers, 'touch and go' transactions will be covered with the same level of fraud protection as a chip and PIN transaction.
Barclaycard's OnePulse credit card, which uses the Visa OneTouch payment system, offers 100% fraud protection on all OneTouch transactions.
One industry official said that, as with any type of new technology or product, people simply needed to try and look past the myths associated with these cards. He said: "For example, casually brushing past a reader in a store does not mean your contactless card will automatically be debited with a purchase you didn't make, nor will transactions be duplicated by accidentally touching the reader twice."
Occasionally 'touch and go' card users will be asked to revert to paying by chip and PIN technology as a way to help cut down on fraudulent use.
The chips used to wirelessly transmit card details do not hold any more information than a ‘chip and PIN’ chip does.
The credit card also needs to be within a few centimetres of a reader for it to successfully transmit data.
It's important that anyone who loses any type of credit card or debit card should report the loss or theft to their credit card provider as soon as humanly possible.
How to go touch-less
Both Visa and MasterCard are providing this new technology and working with certain credit card providers to get the bits and bytes working inside your plastic.
Barclaycard has always leaned on the side of Visa, and so it's no surprise the first 'touch and go' Barclaycard works on Visa's payWave system.
Barclaycard offer two 'OnePulse' credit cards, both offering the same OneTouch Visa payWave system and the added convenience of a built-in Oyster card. Barclaycard offers the OnePulse credit card with 0% purchases and the OnePulse credit card with 0% balance transfers.
As for MasterCard - the HSBC credit card is currently offering certain new applicants who live or work in London an updated version of their credit card with MasterCard PayPass technology installed.
payWave and PayPass are generally speaking the same thing. However, Visa and MasterCard are rival companies - so just because one retailer may offer Visa payWave they might not necessarily be able to accept MasterCard PayPass transactions too.
However, unlike Blu-Ray and HD-DVD, its incredibly unlikely one payment provider will succeed over the other. It's simply the same as ATM machines - they have to have both Visa and MasterCard technology implemented to accept transactions from both Visa and MasterCard cards.
Choosing between a Visa payWave and a MasterCard PayPass credit card only comes down to the actual credit card you'd be getting from the provider - basic rates, fees, offers.
For example, many people might be more tempted by Barclaycard’s OnePulse credit card, which offers OneTouch (Visa payWave) as well as offering a built-in Oyster card.
HSBC's version on the other-hand, offers pot-luck on whether or not you’ll get MasterCard PayPass built-in and doesn’t come with an Oyster card or any other commuter perks.
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