UK embraces contactless but education is needed

Contactless cards allow people to make purchases as a fast and convenient alternative to cash. Although it has been in use since September 2007, a whopping 88% of British have never heard of the technology.

Despite this, and when asked what advantages contactless cards would bring, nearly half of people (49%) thought contactless cards would result in shorter queues and the same percentage liked the idea of not carrying cash. Nearly a quarter (23%) of people also felt contactless cards left them more in control as the cards don't leave their possession, whilst one in five (22%) thought they would be really easy to use.

Although people are generally optimistic about the rollout of contactless payment cards, the survey of 2,200 people by life assistance firm CPP showed the majority of people (77%) are concerned about payment fraud as criminals do not need a PIN to spend money on these cards. Similar concerns include a fear of increased crime levels (48%) as well as criminals hacking into personal details (34%).

With the current credit crunch, not surprisingly nearly half (47%) are concerned about keeping an eye on their expenditure and 34% of people think they will spend more as a result of the added convenience and ease that these cards bring. Even though debt is a big concern, British have indicated that they would like to double the limit of money currently allowed per transaction - from £10 to £20. This coincidentally is the average amount carried in cash per person.

Geoff Barker, head of contactless payments at CPP, comments: “There are undoubtedly numerous consumer benefits associated with contactless payments. People will certainly save time and no longer have to fumble around for the right change, but this research shows we need to dispel some popular myths around security and fraud. For example, casually brushing past a reader in a store does not mean your contactless card will automatically be debited with a purchase you didn't make, nor will transactions be duplicated by accidentally touching the reader twice.”

Other interesting statistics revealed by the research include the fact that men seem to be more aware of contactless payments, with one in five (20%) having heard of the new technology as opposed to less than one in ten woman (9%). Not surprisingly, young people are more likely to embrace the new technology. Only 19% of people aged 16-24 said it would not be useful as opposed to 44% of people aged over 55 years.

On future plans for contactless cards, Barker says: “APACS, the UK's payments association, has forecast that there will be 5m contactless cards in circulation and 100,000 contactless merchant terminals in place by the end of 2008. Therefore, if your payment card is due for renewal in the near future, there is a good chance you will receive one of these cards.”

“However, lost or stolen contactless cards could be used by someone to spend a small amount, without the need to enter a PIN or other verification method. It will therefore become even more important for consumers to promptly cancel their cards to minimise both the risk of fraud and having to prove any subsequent contactless transactions were not those of the cardholder.”