August 22, 2025 · 11 mins read
Santosh Kumar
Contactless credit cards are one of the latest advancements in the credit card landscape. As the name suggests, they enable touch-free transactions without the need to insert or swipe the card at a POS machine.
Users simply need to tap or wave their credit card to make payments. Unlike traditional credit cards, contactless cards feature a ‘Wi-Fi’ symbol. To identify whether you have a contactless credit card, look for this symbol on your card.
Contactless payment methods have made life simpler. All it takes is one tap, and the payment can be carried out in a hassle-free manner. To complete a contactless transaction, one doesn't even need to exactly 'tap' the card on the machine. Simply holding the card in place and hovering over the scanner will do the trick.
The ‘tap and pay’ technology for credit cards is widely used by people across the globe. But did you know that there are also certain risks associated with such payments? Your credit card information can be misused if you don’t take appropriate measures to stay safe.
Your credit card sends out electromagnetic waves that make a contactless transaction possible. All you need to do is be within the range of the payment that needs to be made, and the card can be used for payments. The maximum range for such payments is 4 inches. It is best to keep your card within this range so that unauthorized transactions can be prevented.
If you are worried that people around you might want to steal your credit card information, you can use an RFID-blocking wallet to be extra safe. The wallet blocks the radio waves being emitted from your credit card so that when the card is inside the wallet, it is not possible to scan its information using an RFID scanner.
This is perhaps the most important, yet taken-for-granted measure. Keeping your credit card in a safe and secure location at all times is essential. Even if you do lose your card under some unforeseeable circumstances, get it blocked as soon as possible so that nobody can misuse the contactless payment option.
One of the easiest ways to add a layer of security to your credit card is by enabling the lock feature to prevent unauthorized transactions.
Keeping a tab on your card transactions is another way of taking appropriate measures to stay safe. In case there are any unauthorized transactions being carried out via your card, you will be easily notified of the same and can take the necessary steps as soon as possible.
Sign up for transaction alerts on your card so that as soon as a transaction is made, you are immediately notified of the same via text or email. This will also help you keep track of your transactions.
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The question that now arises is with regard to the safety of contactless cards. If you don't have to swipe or dip your card, what are the chances that you walk past a contactless card reader and it (without your knowledge) deducts money from your credit card?
The answer to this question is simple. This won’t happen. It won’t happen because of the different layers of security that go into a contactless card.
In order to better understand how safe contactless cards are, let’s take a look at some of the common myths and the actual truth.
Myth 1: A thief can make transactions with your card, without it leaving your pocket and without your knowledge.
Truth: For a contactless transaction to take place, the credit card and the reader need to be at least two inches away. So, the chances of this happening are extremely slim. Moreover, if you do find that you have been wrongly charged, you can always raise it with your card issuer. This way, you will not be held liable for the transaction.
Myth 2: All your information is transmitted to the merchant when you use a contactless mode of payment.
Truth: This is actually far from the truth. When you make a contactless payment with your credit card, information such as your name, your billing information, or your CVV is never transmitted to the merchant. Instead, only your account information, along with a one-time password or code, is sent from the card to the reader.
Myth 3: A person may mistakenly be charged for a purchase even if they just walk past a contactless terminal.
Truth: Unless the contactless machine has been tampered with, it is highly unlikely that you will be charged just by walking past a machine. Or else, you can place your card in wallets or cases that give contactless payment protection for extra safety.
Myth 4: You may be charged two times or more for the same transaction without your knowing or consent.
Truth: This cannot happen because every contactless transaction requires you to tap your card or be within a few centimeters of the card reader. In addition to this, a one-time code is transferred from the card to the reader for each transaction. Moreover, contactless point of sale (PoS) readers allow only one transaction at a time.
So, it's quite clear that most fears that surround contactless credit cards are unfounded, and they are safe to use.
Benefits of Using Contactless Cards Now that you know quite a bit about contactless cards, here are some of the other benefits of these cards to help convince you to apply for one (if you aren't already convinced):
Credit Card skimming is the easiest way for fraudsters to get your card details. Your card information is usually taken by these fraudsters when they take your card to swipe it or dip it in the card reader. This is entirely minimised with contactless cards since it doesn’t leave your hand.
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As mentioned earlier, contactless payments are quite safe. Moreover, even if your card is tapped or waved multiple times, the security measures in place ensure that there is only a minimum number of transactions that can be made before you will be required to enter your PIN.
If a fraudulent transaction is made using your card, you don’t have to worry since you will not be liable for those transactions. Almost all banks provide you with 100% liability cover.
By using a contactless credit card, you don’t have to waste time at checkout waiting for the merchant to swipe your card, then you need to enter the amount, request the PIN, and then approve the transaction. But in a contactless credit card, you only need to tap the card to the reader, wait for it to beep or turn green, and you are good to go.
Contactless payment offers significant advantages to both consumers and businesses. Here is a list of the pros of contactless payment from both perspectives.
Quicker transactions and shorter queues at the checkout are the most significant advantages of contactless payment. Handling cash is not a concern at the checkout. You also don’t have the hassle of punching in your PIN.
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Tap-to-pay technology is more reliable and secure than other forms of payment. The chip technology protects you against any fraudulent purchases through encryption and dynamic data technologies.
Say goodbye to bulky wallets once you go cashless. Your NFC-enabled smartphone is all you need to make your payments.
Most loyalty programs offered by stores are in sync with the tap-to-pay smartphone that you use for payments. They automatically confer discounts and loyalty points at the time of payment. Some banks also offer cashback and incentives when you use the contactless payment feature.
Adopting tap-to-pay technology is faster, with fewer workforce requirements. Contactless payments reduce the time that businesses spend on operating card machines or counting cash.
Many studies say that businesses that offer contactless payment facilities provide a smoother and quicker checkout experience to customers, which might earn their loyalty.
Providing a contactless payment facility does not attract any additional processing fee. Businesses pay the same fee applicable for a transaction with a regular credit card.
Contactless payment technology is secure and encrypted to discourage any hacking attempts. Better transaction security means that businesses get their money without any disputes. Besides, contactless payments are protected against fraud by most issuing banks.
Despite its many advantages, the contactless payment system has its fair share of concerns. Modern technology has managed to address these issues effectively, but let’s go ahead and evaluate some of these concerns about the contactless payment system.
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Retailers are slowly facilitating contactless payments, but consumers continue to remain dissatisfied with the spotty coverage, especially among the independent retailers. However, there has been an uptick in the last couple of years.
As per RBI ruling, contactless payments carry a capping limit of INR 5000* per contactless transaction in India. For higher-value transactions, entering a PIN becomes necessary to protect against fraud. Some of the consumers may find this rule to hinder their overall shopping experience.
Consumers face certain technical barriers in the case of mobile contactless payments. The mobile tap-to-pay system needs you to have an NFC-compliant smartphone.
Mobile Contactless payment devices may not work internationally. Despite similar technology, some mobile wallets used for contactless payments do not get accepted abroad. You may also incur an additional foreign transaction fee.
Since the transaction with a contactless card does not need any PIN authorisation, there is a fear of fraudulent purchases in the event of it being lost or stolen. In such a case, it is always a good idea to let the issuing bank know about this. Most banks give you a 100% fraud guarantee, relieving you of any responsibility, provided you were careful with its use.
Other than being backed by a fraud detection system and layered security, customers are still aware of the problems using a contactless payment facility. This mindset can be a problem for businesses adopting and facilitating tap-to-pay payments.
When the topic is technology and financial transactions, the subject of fraud is sure to come up. Even so, contactless payment is a practical and safe option. Banks and card brands are increasingly prepared to avoid this type of problem. And we account holders have the responsibility to learn more about these possibilities and take all measures necessary to increase our own security.
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Contactless as a form of payment is generally more secure since you don’t have to hand the card over to another person. Moreover, it helps you save time.
You can use the Contactless cards at any place that has a POS Machine. The card can be used to tap and pay. Any POS Machine that comes with a contactless symbol has been enabled for contactless payments.
No, even if the card is waved twice, you will be charged only once.
Any purchases that are made using the contactless mode will be shown the same way as those made using a regular card.
You will receive an SMS/email to your registered mobile number/email ID, and you will also get a charge slip if the transaction has been successful.
You should hold your card within a distance of 4 centimetres.
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