Member Article

Millions worried about security of contactless cards

Millions of consumers are concerned about using contactless cards in the wake of rising levels of fraud, according to a study by Defender Note.

Recent figures by Financial Fraud Action showed contactless card crime rose 16-fold in 2015 when compared with 2014[1], and today’s research shows that a quarter (24 per cent) of all UK adults think the cards make fraud too easy, whilst 26 per cent say they think they are more susceptible to fraud than non-contactless payment methods.

Since being introduced to the market, contactless card use has soared, with recent figures showing payments rose by more than 300 per cent in 2015 to reach £7.75 billion. Yet, many consumers are still anxious about using the technology, with one in five (19%) claiming they will never use a contactless card because they don’t think they’re secure.

Several banks have also come under criticism for failing to give customers the option before issuing them with contactless cards - and Defender Note research shows 30 per cent of consumers believe that banks should ask customers whether they want a contactless card before issuing them with one.

If contactless cards are stolen, a thief can make up to ten payments under £30 in a short time frame before being required to enter a PIN.

More worryingly, the cards can also be ‘skimmed’ – a technique in which a scammer uses an RFID chip reading device, widely available online, to lift the cardholder’s details while standing in close proximity to them. These devices enable criminals to steal a contactless card’s details, which they can subsequently use to make purchases on websites that don’t require the customer to enter the security code of their bank account.

Recognising the risk faced by a growing number of consumers, Defender Note is set to launch its fraud-protection product today.

The device can be inserted into a wallet or purse and blocks RFID signals transmitted by the contactless chip in the card, protecting the user from contactless card fraud

Morgan Rothwell, Director of Defender Note, said: “Contactless card fraud is rising fast and official figures are only the tip of the iceberg. Most skimming victims will have no idea they’ve been robbed until they check their bank statement, and many cases will not be detected at all.

“Our research confirms that people see contactless technology as risky, which is why we’re launching the Defender Note – a cost-effective way of protecting yourself against this increasingly common type of fraud, which ensures consumers can continue using contactless technology with ease and peace of mind.”

[1] http://www.financialfraudaction.org.uk/cms/assets/1/downloads-7-3085-2015-year-end-fraud-update-report.pdf

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