What is Contactless Credit Card & How Does It Work?

Contactless credit cards are trending big time in the market. These credit cards use a no-touch form of payment, and all you need is one tap, and your payment is processed. Unlike traditional credit cards that require swiping or inserting the card, contactless credit cards use radio frequency technology to communicate with the payment terminal. This makes payments even faster and more convenient for users, as they don’t need to physically handle the card or enter a PIN for small transactions. These cards have enhanced security features such as tokenisation and encryption, making them more secure than traditional credit cards. Many banks and financial institutions in India are now offering contactless credit cards to their customers, making it easier than ever to make quick and secure payments.

What is Contactless Payment?

When you make payments without making any contact, it is called contactless payment. These payments can be done via credit, debit, or gift cards, or with the help of UPI. Contactless payment methods are also secured with encryption and tokenisation to protect user information.

What is a Contactless Credit Card?

A contactless credit card is a payment card that uses radio frequency identification (RFID) technology to communicate with a payment terminal. This makes it easier for users to complete transactions by simply tapping or waving their card near the terminal, rather than swiping or inserting it. No doubt, contactless credit cards are quicker as there is no need to enter a pin (up to a certain limit), more convenient as there’s no need to swipe, and of course, equally secure for users. This eases up things, particularly for the more regular, day-to-day, smaller transactions.

How Contactless Credit Cards Work

With their rising popularity, it is important to understand how contactless credit cards work.

• Contactless credit cards have a small electromagnetic chip.
• Whenever you place your card to make transactions near a contactless-enabled device, the chip catches the frequency and transfers the information.

Remember to not remove your card instantly and wait for the signal to turn green to ensure your transaction is successful.

Benefits of Contactless Credit Card

Contactless credit cards come with many benefits. These include:

• They enable you to make easy and faster transactions. Just tap to pay, and your payment is made without entering the PIN or inserting your card.

• With contactless credit cards, users can simply tap or wave their card near the payment terminal, making the payment process more convenient and user-friendly.

• Most contactless credit cards offer exclusive and exciting rewards that help you earn more and more reward points that you can encash later.

• Contactless credit cards can also be used with mobile payment systems and wearable devices, making it easier for users to make payments from their devices.

  
  

How Does a Contactless Payment Work

Using your contactless credit card is easy and simple. You just need to ensure that your merchant has a contactless payment terminal.

• Hold your card over the POS machine or any other contactless terminal.
• Continue to hold it for a few seconds to ensure your transaction is made.
• Once completed, you can see a successful message or a beep sound.
• If you have connected your contactless credit card to digital wallets like Google Pay or PayTM, hold your device over the card terminal to make a payment rather than removing your card from your wallet.

Also Read: What Is Credit Card Billing Cycle And How Does It Work?

How to Know if Your Credit Card is Contactless

To know if your credit card is contactless or not, look for a symbol on the front or back of your card. The symbol typically looks like a Wi-Fi signal, or four curved lines, and indicates that the card is equipped with an RFID chip. If still unsure, you can always reach out to your issuer for the same. Remember that you need to enable contactless transactions either from your issuer’s app or by contacting them. In some cases, many issuers also upgrade your card to a contactless one by issuing a new one.

Security and Contactless Credit Card

Contactless credit cards have advanced security features that protect you against fraud. Some of them include the following.

Tokenisation:

Contactless credit cards use tokenisation, which replaces the actual card number with a unique token, making it more difficult for hackers to steal the user's information.

Encryption:

This is done to protect the user’s information as it is transmitted from the card to the payment terminal.

Limit on transaction limit:

These cards have a limit on tap-and-pay transactions to ensure that no unauthorised payment occurs. In other cases, you too can set a limit by using the app of your issuer.

Also Read: How your OneCard Keeps You Safe From Fraud

Are Contactless Cards Safe to Use in India?

Definitely! Contactless credit cards are safe to use in India due to their advanced security features like tokenisation, encryption, and app controls. However, it is important to monitor your transactions from time to time to avoid any discrepancies and protect yourself from fraud.

Final Words

One Credit Card comes with a contactless feature and has a powerful mobile app that has advanced controls, swipe-to-pay, and tap-in-app authentication apart from many exciting features. Get your OneCard today!