What Are the Disadvantages of Contactless Cards? Security Risks and Limitations Explained
Discover the main disadvantages of contactless cards including fraud risks, transaction limits, and card clash issues in this quick guide.
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The use of contactless cards comes with several disadvantages including: higher susceptibility to fraud compared to chip-and-PIN transactions, as they can potentially be scanned by thieves with the right equipment. There's also a limit on transaction size, typically set to relatively small amounts to mitigate fraud risk. This can be inconvenient for larger purchases. Additionally, there's the risk of 'card clash' when multiple cards are detected by the reader, resulting in the wrong card being charged.
FAQs & Answers
- Are contactless cards more vulnerable to fraud? Yes, contactless cards can be more susceptible to fraud because they can be scanned wirelessly by thieves using specialized equipment, especially for small transactions that don't require PIN verification.
- What is 'card clash' in contactless payments? 'Card clash' occurs when multiple contactless cards are near a payment terminal simultaneously, causing the reader to detect the wrong card and potentially charge the incorrect account.
- Why do contactless cards have transaction limits? Transaction limits are set on contactless cards to reduce fraud risk by capping the amount that can be spent without additional verification, which can cause inconvenience for larger purchases.