The UK could be increasing the contactless payments limit from £45 to £100, as one of its first moves away from the European Union.
This idea has been raised to the UK Treasury by trade association UK Finance, which claims it will help reduce the spread of the coronavirus by minimising the need of touching point of sale terminals, according to a report from The Mirror.
The contactless payments cap was only increased from £30 to £45 in April 2020, as a countermeasure to the virus. It was increased after consultations within the industry and the retail sector and was mirrored by a number of other European countries.
When contactless payments were first launched in 2007, there was a limit of £10.
Upgrades to the POS terminals which would allow them to accept the higher amounts can be done remotely, but the process of updating all terminals could take a while, it said.
Contactless payments have surged in usage over the past year, thanks to the pandemic halting the usage of physical cash. A recent report from Global Market Insights claims the contactless payments sector could be worth $100bn by 2026.
With the increased cap on contactless payments, there is still cause for concern. This higher limit could help fraudsters and criminals steal more money from compromised cards.
Last year, KPMG, head of financial services consulting Lisa Fernihough had welcomed the £45 increased limit of contactless payments. She stated that it will help society through the pandemic crisis.
However, it is not without risk. She said, “The rules around how often customers are authenticated via chip and pin have been relaxed, meaning someone with a contactless card can spend more money, more frequently. The changes may create an opportunity for fraudsters, putting added pressure on the fraud departments of banks and credit providers and driving the need for more investment in technologies that can identify and prevent fraud.
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