Contactless Payments for ICBA Bancard Clients
Contactless is Fast, Easy, and Secure
Contact Your Processor to Get Started!
Now is the time to contact your processor about contactless payment and learn how to get started and plan ahead.
Get the Facts on Contactless
At the June 2018 Visa Payments Forum, Visa reported that nearly 70 percent of all merchant terminals in the U.S. are now equipped with NFC (Near-Field Communication) setting the stage for contactless payments - the next phase of EMV. While many of these terminals have not yet been enabled, contactless payments will likely get a boost as first-gen EMV chip cards begin to expire and financial institutions strategically reissue plastics that feature chips embedded with NFC technology. These early adopters will be poised to shift volume from cash and competitors thereby driving top-of-wallet status.
For community bankers who are considering offering a dual-interface card (contactless) in the near future, we answer some general questions. Visit the US Payments Forum, formerly the EMV Migration Forum, at www.uspaymentsforum.org, for more information including a whitepaper on Mobile and Contactless Payments Requirements and Interactions.
A. A contactless payment card has an NFC antenna embedded in the plastic which securely enables close-range payments. Customers need only tap their contactless card at a checkout terminal near the Contactless Symbol and the payment is sent for authorization.
A. The card need be no more than 1-2 inches (about 4 cm) from the Contactless Symbol on the checkout terminal.
A. Yes. Each transaction is accompanied by a one-time code securely protecting a cardholder’s payment information just like with a chip card. Customers also can’t pay accidentally. Their card must be 1-2 inches of the contact-less enabled terminal for the transaction to occur (they also will not be billed twice even if they accidentally tap twice). Additionally, while skimming is possible a fraudster must be less than 4 cm away from a contactless card to skim.
A. Reissuance of the first wave of EMV cards is now approaching (4Q 2018-2019). Issuers should first determine when their existing EMV stock is set to expire (all your cards issued on the current chip will continue to function until the expiration date on the plastic).
You should next work with your processor to find a solution and identify any best practices that will minimize time, cost, and complexity to ensure a smooth process and minimize any inventory management challenges during the transition.
And, although the cost of contactless cards is dropping, realistic spend lift is required to offset investment so issuers may consider creating a reissue strategy that factors in cardholder spend.
Tina's Take on Contactless
Tina Giorgio: In an e-book published last week by PYMNTS.com, “Fresh” is how I described payments in 2018. I can’t think of a time when we’ve seen as many innovations emerge in this industry than the past 11 months.
Tina Giorgio: Contactless transactions include everything from flashing your watch at the point-of-sale to paying for your groceries, via your refrigerator. As “smart” devices get even smarter and more prevalent, payment has become part of their foundational fabric.