This is how it works: contactless payment instead of cash

Quick and easy

There are different ways to pay contactless with the NFC system. Smartphones and smartwatches can be used, as can of course conventional debit cards. With a contactless card payment, the card is simply held at a maximum distance of 4 centimeters over the payment terminal, which confirms the payment acoustically or visually. Since April 15, 2020, payments under 50 euros no longer have to be confirmed with a PIN; this is only required after five transactions or from a total transaction volume of 150 euros.

The same applies to the limits for payments with the mobile device. The difference in the payment process is small: the device must first be unlocked before it is held over the terminal. Later, the Google Pay app or Apple’s Wallet app, which must be installed on the mobile device for NFC payment, sends a push message. Completely unnoticed, no payment can be made here.

Every new device and card can use NFC

For some years now, new cards and mobile devices have been equipped with an NFC chip – this is a prerequisite for contactless payments. So in almost all Android and Apple devices from the iPhone 6 chips already incorporated. NFC payment is also possible at many German checkout terminals. However, the NFC function must first be activated on mobile devices before the device can transfer money or data. So if you don’t want that, you don’t have to worry about the chip in your cell phone or smartwatch.

A wave-like symbol indicates whether a credit card or payment terminal is NFC-enabled. If a money card is not equipped with NFC technology, in most cases you can ask the bank for a new card. This will usually be suitable for contactless payment transactions.

And so it is with security

In general, the NFC method is considered secure. At checkout terminals, employees must explicitly confirm that contactless payment is to be made before making the payment. In addition, the devices automatically block the payment process if more than one NFC chip is in the transaction-capable vicinity. Since the distance can be a maximum of 4 centimetres, it is very unlikely that you will accidentally pay for someone else’s purchase.

The computer magazine c’t has tested whether it is possible to tap card data without the owner’s consent – devices that are capable of doing this can easily be bought on the Internet. The result was that it is possible to read card data – but no transactions can be carried out with these devices.

Theft very unlikely

Theoretically, it would be possible to carry out secret transactions with a mobile card reader in the subway. The device would only have to get close enough to an activated NFC chip. But:

“But in order to be able to register there at all, you have to be a retailer. And only then can you start the whole procedure. So just buy a terminal and then use it to take the subway or something similar, you can’t use it at all generate payment.” said Sylvie Ernoult, spokeswoman for the Federal Association of Banks to the MDR.

And Patrick Biskup, head of the card management and authorization department at Sparkasse Finanz Informatik, explains in an interview with the Sparkasse that it is not necessary to wrap the money cards in aluminum foil: Such a mobile reader would need the Internet and that is, for example, in the underground Web not strong enough. In addition, the signal from cards or mobile devices would be significantly weakened by the fabric of clothing and wallets.

Olga Rogler / Editor finanzen.net

Image sources: Stokkete / Shutterstock.com