Contactless payments - new ways to pay without cash

We’re already paying for things without actual cash when we use debit, credit and other plastic cards. But many different ways of paying without cash are coming our way. Here’s a few of them and how they work.

 

Cash vs contactless

Studies as far back as the 1970s prove that we don't see cards as ‘real money’ and tend to spend more when using plastic rather than cash.

Cash is vivid, transparent – and painful to spend. Debit and credit cards, and just waving your smartphone in front of a scanner, are ‘easy’, fun’ and a bit of a novelty.

Ultimately, cash encourages self control while other forms of payment encourage spending, often on unnecessary luxuries.

So it’s important to keep an eye on your bank statement so you know home much money you have left. Whatever method you use, it’s still your money that you’re spending, and it won’t get ‘topped up’ till payday!

Contactless payments

You can pay without cash (contactless) by using credit and debit cards, key fobs, smartcards or other devices that use technology for making secure payments. Most new bank cards are now fitted with the technology, so check for the contactless sign above.

Also known as ‘wave and pay’ – this is a form of paying for small purchases (up to £30) without having to input your PIN. You simply wave your card or other device over the scanner terminal which then deducts the money from it.

See the UK Cards Association website for more information and a list of places where you can use your contactless card.

You can use your contactless card on London’s  buses, Tube, DLR and Overground trains in place of Oyster cards.

For other regions, check with the local transport organisations.

Mobile phone payments

To pay for your shopping using your mobile it will need to have in-built contactless technology. Currently only a couple of providers offer this service. You then simply hold your phone up to a reader to make a purchase. See Contactless mobiles on the Payments Council website for more information.

You can pay friends and family back using just their mobile number with Paym. This system launched in April 2014 and is available to customers of a number of banks and building societies. It’s fast and secure. See www.paym.co.uk to find out how to register or go to your bank or building societies’ website for more information.

Smartphone apps

You can currently check your balance as well as make a payment by inputting details of the account you want to pay on your smartphone, either by going to your bank’s website or by downloading their app. See Apps and the internet on the Payments Council website for more information.

A new service, Zapp's Pay by Bank app will be available from October 2015 to Barclays Pingit users.  A number of business will be supporting this app once it is launched, including banks and supermarkets.

Zapp will be synchronised with existing online banking apps for smartphones and tablets. It will work by using a code sent to your smartphone when you touch the 'Pay by Zapp' button on a self-checkout touchscreen or tell the cashier at a till that you wish to pay this way. Alternatively, you will be able to scan a code into the handset from a paper bill or the screen on a modern card machine. 

For more information see the Zapp website.

Pay by wristband, fob or sticker

Following last year's launch of the pPay wristband, Barclaycard this summer launched a bPay fob and bPay sticker (a discreet, secure sticker, which can be stuck onto any flat surface). The devices are available to anyone with a UK-registered Visa or MasterCard debit or credit card, not just Barclaycard and Barclays customers. You add funds to your wallet 'on the go' using the mobile app, online through a portal, or set up your account to top-up automatically when your balance falls below a pre-set level. You pay for goods by simply waving your wristband, fob or sticker over the shop’s terminal.

bPay can be used for purchases up to £30 at any contactless payment terminal in Britain and abroad.

You can buy the devices on the bPay website and in some high street stores. Anyone over the age of 12 can use bPay. 

For more information see the Barclaycard website

Pay with Apple products

Apple Pay lets you use iPhone 6 or Apple Watch to pay in wherever contactless payments are accepted. You can also make purchases within participating apps on iPhone 6, iPad Air 2 and iPad mini 3. More shops and apps are accepting Apple Pay every day.

With Apple Pay, instead of using your actual credit and debit card numbers when you add your card, a unique Device Account Number is assigned, encrypted and securely stored in the Secure Element, a dedicated chip in iPhone, iPad and Apple Watch. These numbers are never stored on Apple servers. And when you make a purchase, the Device Account Number, along with a transaction-specific dynamic security code, is used to process your payment. So your actual credit or debit card numbers are never shared by Apple with merchants or transmitted with payment.

For more information see the Apple Pay website

How safe is contactless?

Be aware of the risks and stay safe when using contactless - see Stay safe with contactless payments.

As with all your personal information, it’s your responsibility to keep your cards and phone safe. Take care not to leave your belongings unattended. 

Fraudulent transactions on contactless cards are protected by the same rules that apply to other card payments. This means that if you're a victim of fraud, your bank will refund you the money, provided it’s not a result of your own negligence.

However, you will have to pay the first £50 of the total amount of fraudulent transactions made on your card.

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