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Tuesday, 1 September 2015

Contactless Card Payment Limit Rises To £30

The single payment limit for a contactless card transaction has been raised to £30 from £20, as their popularity soars despite lingering security concerns.

It is the third time that card holders have been allowed to spend more in one transaction since contactless technology was first introduced in the UK in 2007 as a handy way of making a small payment - easing the need for a holder to carry cash.

The increased limit affects smartphone payment systems such as Apple Pay, which also use the swipe of a reader to complete a payment without the need to enter a PIN number.

However, holders were warned that not all retailers would be able to offer the new limit from today because some bank-owned payment readers still needed updated software.

The industry body, the UK Cards Association, said there are now 58 million contactless cards in the country, with more transactions taking place during the first nine months of 2014 than in the previous six years combined.

More than £2.5bn was spent on them in the first half of this year, it added.

The number of places which accept them has grown but remains fairly limited.

Chains which accept them include McDonald's and Aldi, while the M6 Toll and London transport services also allow contactless payments.

Richard Koch, head of policy at the UK Cards Association, said: "Contactless payments are fast, easy and secure and use the same robust encryption technology as chip and PIN.

"Consumers are increasingly choosing contactless as a way to pay and the new £30 limit will give shoppers and retailers even more opportunities."

But the body has been forced to defend the technology from security criticism, amid claims from groups including Which? that cards are vulnerable to fraud.

Contactless cards work by containing a chip that holds a consumer's account information and an antenna that picks up power from a signal sent out by the card reader.

The consumer group suggested wrapping cards in tin foil to help prevent fraudsters being able to steal money from them.

It said easily available technology was being used to take information from cards but the UK Cards Association has described instances of fraud on contactless cards as "extremely rare", with providers offering protection against any losses as long as customers had taken reasonable steps to keep their card safe.

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