Contactless payments – how does it work and is it secure?

Published June 22, 2017

Entercard has recently launched contactless payment functionality on their credit cards in Sweden. Customers with new Swedbank, Sparbank and re:member cards can now blip their cards in shops and restaurants and make a contactless payments.

The number of contactless terminals has expanded rapidly since the start of the year – from ca. 7% to 14% in just a few months. With increased numbers of contactless cards and terminals around the world, you may wonder how the payment works, and how secure it really is.

What is contactless payments?

Contactless payments let the customer get the shopping done quickly and safely. The customer only needs to hold an activated contactless card above the card reader with a universal contactless symbol. This makes it easier than ever to pay, and you don’t have to worry about cash.

Contactless payments are accepted worldwide in shops, fast food restaurants, grocery shops, pharmacies, and on public transport. It is also possible to pay contactless in taxis and various types of vending machines, such as parking machines.

Contactless payments are secure

An always-relevant topic when it comes to payment solutions is security. This topic is frequently discussed when it comes to contactless payments, as no contact with the terminal is needed to make a payment, nor are PIN codes. Let us explain how it actually works, and kill the myth that contactless cards are not secure.

NFC (Near Field Communication) handles communication up to a few centimeters. In theory, you can read a contactless card from longer distance, but it will require large and expensive equipment, and it has never been proved to work.

The only information you can retrieve from a contactless card is PAN (card number) and expiry date. The rest of the information is “filtered” and not accessible without correct keys.

The encryption is unique to each purchase, and protects transaction information. The customer keeps the card all the time, which reduces the risk of the card disappearing or being copied. In addition, there are other security measures that ensure that you only need to pay once even holding the card over the card reader twice.

At Entercard, we have followed industry standards when manufacturing our contactless cards and setting the parameters, and they have been approved by Mastercard.

Contactless cards are therefore a secure way to pay. It’s time to start blipping!