Should I Use Contactless (NFC) Payment Cards?

This article was first published by Andrej Probst, an innovation manager, on Rozumy.sk, a technology blog covering innovation, management, banking and security.

smartwatch with Google

Nowadays, almost all smartphones contain NFC (Near field communication) technology.

Contactless cards use this technology when they communicate with contactless payment terminals to exchange needed information and proceed with the transaction.

However, you can also do this by using your smartphone.

Let’s use an Android phone in our demonstration.

1. First, we are going to install the Banking card reader NFC (EMV) from Google Play. (You may find many similar applications.)
2. Next, Enable NFC on your phone and start the application.
3. Then, place the card next to the phone and the phone will show us information in EMV format (Europay, Mastercard, Visa)

Card details:

• Card Number
• Expiry date
• Card type - e.g. Master card, Visa card
• Type of application – For instance debit Mastercard
• Number of possible PIN retries

Details of the card

Last n transactions:

• Sum
• Date of the transaction

Last n transactions of a card

The bank or the car manufacturer has the authority to decide what will be stored on the card. The data is usually regarding the latest translations. You use this data when you try to prove a claim.

How safe are contactless compared to contact cards?

Let’s look at how we use the contactless cards.

(We randomly chose $20 as the maximum amount allowed for PINless transaction.)

• Paying at a payment terminal by placing the card against the machine. If you want to access more than $20 will be required to enter your PIN.
• Withdrawing money from an ATM requires inserting the card into the machine and entering your PIN.
• Paying via the Internet requires your card number, expiry date and the CVV code.

Now, compare contact and the contactless cards in two scenarios.

Scenario 1: The thief has physical possession of your card

“Good” for him as he can pay up to $20 without needing to enter the PIN. Many banks set amount limits for PINless transactions. When you exceed this limit, you will be required to enter the PIN.

Without the PIN, the attacker can’t access your money via the ATM.

If the cardholder gets notified of this transaction, he can request to block the card.

Scenario 2: The thief accesses your card via NFC

In this scenario, the thief doesn’t have your card but scan it using NFC. (He will have to get really close.) He can get read your card number and the expiration date. Fortunately, doesn’t have CVV code, which is required for many online transactions.

The poor guy won't be able to access money from an ATM because he doesn’t have the PIN.

He might be able to know other information, for example, the time of the latest transactions. However, how is that information useful for a card thief?

What do you learn?

No fear

If you like and use classic contact cards, then you don’t need to be afraid of contactless cards. If someone manages to steal your card, you can lose the amount allowed for the transaction.

No worry If you're worried about people can copying your data via NFC, you can use a special casing which protects the card from electromagnetic signals. Even if someone manages to scan the info, he will still need the PIN number and/or CVV code. But please take note and contact and ask your bank to know the data left on your cards.

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Photo credits: Depositphotos