Majority of UK consumers fear contactless fraud

More than three in five (63 per cent) UK consumers are concerned that their contactless payment cards could be used fraudulently, according to new research.

A survey of 1,000 current account or credit card holders in the UK by IDEX Biometrics ASA found that 54 per cent fear that contactless technology could enable criminals to scan a contactless card in their pocket and steal funds without their knowledge.

In an indication that the novelty factor of contactless is wearing off due to security concerns, 49 per cent of consumers said they would feel more secure if they were able to use their fingerprint and PIN to authenticate transactions via their payment card.

In addition to these security concerns, consumers are increasingly frustrated about the £30 contactless limit, with 44 per cent of 25 to 34 year-olds believing that the contactless limit should be removed altogether, along with 27 per cent of adults overall agreeing.

For younger shoppers, PINs are just as much hassle – 35 per cent of 18 to 34-year-olds will make sure their transaction is under £30, so they can simply tap and pay.

In response to this, some banks and retailers have already rolled out Strong Customer Authentication (SCA) to meet the Second Payment Services Directive (PSD2), which came into play on 14 September. This requires customers to use two factors of authentication, such as a PIN combined with the possession of a payment card; even for contactless payments.

The survey also highlighted a growing familiarity with biometric forms of payments, such as fingerprint scan or facial recognition, to authenticate transactions via their payment card, with 49 per cent saying they would feel more secure using these methods.

However, security and data privacy remains a top priority, with 44 per cent saying that if the bank can assure them that their fingerprint biometric data would be safe, unshared and not held anywhere, they would be happy to use biometric authentication as a replacement to their PIN.

David Orme, senior vice president at IDEX Biometrics ASA, said: “As the number of contactless transactions in the UK continues to rise, the financial industry must do more than just introduce SCA to address consumers’ growing concerns about card theft and contactless fraud.

“Fingerprint biometric authenticated payment cards can’t be scanned from your pocket, or used without your knowledge, as the card needs the owner’s fingerprint for a transaction to work – by adopting this form of card authentication, we can say goodbye to contactless fraud and leave the £30 payment limit behind for good.”

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