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In the olden times, before 2015, American shoppers using credit would enact a familiar payment ritual: Pick out something to buy, plunk down your credit card on the counter so the clerk can swipe it, take back your card (and your new purchase), and move on.
That routine was disrupted as chip-embedded cards came onto the scene, bringing with them the somewhat clunky experience of dipping a chip-embedded card into a card reader.
Then came contactless credit cards and mobile payments, through which banks, payment networks, and technology giants are pushing new ways to buy things.
And now, in the wake of the coronavirus pandemic, businesses want you to adopt contactless credit cards too.
Visa, Mastercard, and Europay brought the chip card to American wallets when they shifted fraud liability to whichever party (the merchant or bank) had the lesser technology (such as cards without chips, or terminals that couldn’t read them). Banks had to put chips in their credit cards, stores had to get terminals that could read them, and you had to get used to dipping. The whole thing felt much slower.
Since then, many banks have turned the chip card into a magic wand of sorts: Now all you have to do to buy something is wave (or tap) your credit card, phone, or smartwatch (you can connect those devices to a card of your choice) in front of a chip-enabled reader. Swiping has become something we do only when the payment terminal won’t let you dip or tap.
Apple, Google, and Starbucks (through their apps) have led the charge in mobile payments, while the recently launched Apple Card shows that banks, by way of offering more rewards, may be trying to habituate shoppers into tilting their devices at checkout.
Contactless payments exploded in popularity in spring 2020, when the coronavirus upended how many people think about paying for things. In an April Survey by Mastercard, of 17,000 consumers in 19 countries, 82% of respondents said they view contactless payments as “the cleaner way to pay.”
But there’s more good behind the shift than just reducing the amount of stuff you touch. Chip cards and so-called contactless credit cards have become the norm in many places overseas, as they can make it harder for thieves to steal your information compared with magnetic-stripe cards. For instance, mobile payments and contactless cards don’t transmit your name, card number, or three-digit security code.
Andrew Davidson, Chief Insights officer and Senior vice president at Mintel Comperemedia, wanted to hop on the London Tube this past summer but didn’t have a contactless credit card. He went to the kiosk, but it wouldn’t take his card either. He finally had to queue up at the window for help. “I was a little bit frustrated my card hadn’t been updated [to a contactless card],” said Davidson.
This is the promise of contactless cards: facilitating a swift transaction that lets you avoid tedious lines and unpleasant ticket officers. For example, the New York City subway system launched a pilot program earlier this year to allow people to use contactless cards or mobile wallets to purchase fares.
Of course, not everyone takes the train to work every day. But imagine travelling in Europe or in the Big Apple, and realizing you can avoid an anxious transaction thanks entirely to your card. That’s why, at the very least, you should call your issuer to see if it can switch out your existing card for a contactless one. (They look the same, except for a little icon that resembles the Wi-Fi waves on your laptop or cell phone.)
This is the promise of contactless cards: facilitating a swift transaction that lets you avoid tedious lines and unpleasant ticket officers.Load your cards to your smartphone’s Wallet app, too, as an alternative. (If you use Apple Pay, download the Find My app, formerly Find My iPhone, in case you lose your phone.) There’s no harm in having this as a payment option, especially if you can skip a long “queue.”
Making a card that both dips and taps to pay isn’t easy, just ask the president and CEO of credit card manufacturer CompoSecure, Jon Wilk, who employs scientists from the defense industry to get it right.
Audit the retailers you frequent and identify the ones that accept contactless payments. (Again, look for that Wi-Fi-like icon.) Chip readers from Square, the payment processor whose app prompts you to leave a tip when you pay, typically accept them, so start there. You’ll get into the habit of knowing which card to use where, so you can avoid flailing around at the register and get to your next errand slightly faster.
Sometimes, contactless payments don’t go according to plan, as in the real world, picking not only which card to use but also how to use it requires new levels of consideration that our already bleary brains may not need. And a lot of people aren’t biting: One 2019 report from market research firm Javelin found that just 39% of cardholders own at least one contactless payment card, while Mintel found in September 2019 that only a little more than a quarter of people made a mobile payment in the past year.
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