Contacless payments: how to stay safe

Credit and debit card transactions have overtaken cash purchases in the UK for the first time, according to a new survey from The Payments Council.

And the rise of contactless card payments, some 40 million of which are made every month, is one of the main reasons for this groundbreaking switch.

But not everyone feels comfortable using contactless cards - mainly due to fears about fraud.

Supporters of contactless payments argue that there is a low risk of fraud due to the low level of payment allowed; you can only currently use a contactless card to make purchases worth up to £20, although this ceiling is being raised to £30 later this year.

However, a thief can easily make several contactless payments using your card if you fail to report it as stolen immediately.

Security experts are also concerned about fraudsters using high-tech devices to steal money covertly from contactless cardholders by standing close enough to their victims to activate a payment.

How can I avoid being caught out?

For the moment, the main danger when it comes to contactless cards is that they fall into the wrong hands.

That's why it is vital to keep your card in a safe place, and to report it as lost or stolen as soon as you notice it has gone.

If you become aware of anyone acting suspiciously by trying to brush up against you, for example, you should also step away and check your card and your account in case he or she was up to no good.

I've been defrauded. What should I do?

One of the measures designed to reduce the risk of contactless card fraud is that users are asked to enter their pin at the terminal after the card has been used a certain numbers of times or a certain amount - say £50 - has been spent.

If your card is stolen and used in this way, the losses should therefore be minimal and will generally be refunded by your card provider.

However, you should always report a stolen card as soon as possible as some banks will refuse to cover fraud losses on cards that are not reported within 24 hours.

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