Contactless payment systems are credit cards and debit cards, key fobs, smart cards or other devices, including smartphones and other mobile devices, that use radio frequency identification (RFID) or near field communication (NFC) for making secure payments.
The embedded chip and antenna enable consumers to wave their card, fob, or handheld device over a reader at the point of sale terminal.
Speed Is King
Some suppliers claim that transactions can be almost twice as fast as a conventional cash, credit, or debit card purchase.
Ease of Use Limited for Owner Protection
Because no signature or PIN verification is typically required, contactless purchases are typically limited. Those unauthorized may still take advantage of contactless payment systems as no identification occurs before payment except for certain devices, such as when using mobile payments.
Owners Still In Control
However, owners can block transactions, and that may provide only a relatively short time frame, if any, for fraudulent activities to occur.
Easier Means More Transactions
Research indicates that consumers are likely to spend more money using their cards due to the ease of small transactions.