Visa is to bring all of its contactless transactions online this year across 10 European countries to give consumers “more control over their accounts” following calls from the UK’s Financial Conduct Authority (FCA) for banks to tighten the processes they undergo when a customer reports a stolen contactless card. American Express is also “reviewing options” to ensure those who cancel their cards are protected against contactless fraud.
The security processes in place today when a customer reports a stolen contactless card allow — in a “limited set of circumstances” — for the card to be misused by fraudsters “several months after it has been cancelled,” FCA chair John Griffith-Jones wrote in a letter to the Treasury Select Committee published last month.
The key risk to customers occurs when merchants process payments offline and store them in a batch to process later on, Griffith-Jones explained. At present, around 45% of contactless card transactions occur offline.
“Visa is bringing all contactless transactions online this year in 10 European countries including the UK, with more markets to follow next year,” Visa said in a statement sent to NFC World. “By doing this, we are giving consumers more control over their accounts as they will have up-to-date information on their spending while also making it easier to immediately stop all transactions on a card if it is compromised.”
“American Express takes all types of card fraud very seriously and is currently reviewing options — including a zero floor limit — to ensure those who cancel their cards are protected against contactless fraud,” American Express told NFC World. “We’d like to reassure cardmembers and those who cancel their cards that they would not be held liable for fraudulent transactions on their cards.”
The FCA set out last month a series of measures it plans to undertake in order to tighten the processes banks undergo when a customer reports a stolen contactless card. These include removing the dependency on customers to identify fraudulent transactions, improving customer communications at the time of cancellation and providing clarity to customers on the clearing times for contactless payments.