Theft fears as contactless cards limit increases
INCREASING the contactless payment spending limit could fuel a rise in thefts and fraud, consumer and banking figures have warned.
The amount that can be spent on ‘tap-and-go’ contactless cards is to more than double, from £45 to £100.
Eight out of 10 UK adults used contactless payments in 2019, and the rise on limits will mean millions of payments will now be made simpler, the Government said.
Although the decision may be welcome news for shoppers, some have warned the increase in funds available to spend without typing in a pin could be seized on by criminals.
Gareth Shaw, head of money at consumer research and advice body Which?, said: “The risk of falling victim to contactless card fraud is currently low, but there is potential for thefts to rise if criminals take advantage of the increased spending limit to maximise the amount they can steal.”
Ricky Lee, chief executive and cofounder of banking app sync., said contactless payments are a “good thing” but warned: “It is vulnerable to fraud.”
He added: “There is always a chance that thefts could rise as criminals are tempted by the increased contactless limits.
“A criminal could spend hundreds of pounds in just a few minutes, so a payment card can be a big target.”
Andy Renshaw, from Feedzai, a data science company that looks at fraud risk for financial institutions, said: “While done with the objective of boosting high street shopping, this move means that banks will have to work even faster to identify and block potentially suspicious transactions.
“Of particular interest will be how much a fraudster can spend in total between each chip-and-pin verification (expected to be £300).
“While we expect that all the necessary precautions will be put in place, there is certainly an added element of risk that will need to be accounted as banks and customers adapt.”
While it has been legally in force since Wednesday when announced in the Budget, the increase will not happen immediately as firms will need to make systems changes, with banks set to introduce it later this year.