Spain is one of the countries that leads the growth of mobile payment in the European space. To get an idea, this option is chosen by almost nine out of ten Spaniards to make their payments at physical points of sale. And it goes further: according to a report by Minsait Payments, the figure for this payment method was 10% higher in 2021 compared to the previous year.
Therefore, the use increases, but also the maximum amount that can be spent without having to enter the PIN code. In 2021, the European Banking Authority (EBA) established new limits for making purchases with contactless cards without having to introduce it. Now the maximum in Spain is 50 euros, while before it was limited to 20 euros. Therefore, below this number the user does not have to enter their PIN code, while above this limit it is always necessary to enter the four-digit security code.
One of the reasons for the increase in mobile payment is that it seeks to avoid unnecessary contacts; the less you have to touch the dataphones, the better. At the end of last year, the United Kingdom followed suit, moving from the 45-pound limit to a new 100-pound limit. Because of this, the debate arises as to whether contactless card fraud is really a problem to be taken into account.
Fear of card theft poses a dilemma
In part, there is some fear that a criminal could spend a large amount of money with a stolen card. After all, a higher limit makes this type of crime more attractive. To draw conclusions in this regard, it is convenient to look at the boom that mobile payments are having. In Spain, the use of payment apps between individuals continues to increase, led by Bizum, which is already used by 57% of bank customers, according to Minsait.
One of the reasons for the increase in mobile payment is that it seeks to avoid unnecessary contacts
That said, businesses know that to win and keep customers, they must offer a simple experience without sacrificing security. This means that stores must have the advantages that come from new technologies, making paying for products faster and easier.
However, scammers are always adapting to the latest trends, whether it’s impersonating the organizations people buy from or sending phishing emails to get hold of users’ personal data. In this aspect, it is not so rare that there are cases where a person buys a product that has never existed and will never receive it.
Mobile payment is the mirror in which to look
Although contactless payments are difficult for fraudsters to intercept, consumers do well to worry about the repercussions of losing their card or having it stolen. Therefore, the implementation of secure payment methods must be a priority for businesses to generate confidence and peace of mind for customers. Likewise, financial organizations need to be involved in designing conveniences and balancing them with security.
To understand what needs to be done, let’s look at how Apple Pay or Samsung Pay verify the user’s identity with fingerprint or facial recognition. In this way, it is verified that the person is who he says he is. PayPal operates in a similar way, which has different layers to prove the identity of a user.
The solution for the security of contactless payments could follow the example of these technologies. By verifying the identity through a selfie and a photo of the identity document, the buyers could feel more secure and the process to do so would take only a few seconds. To this would be added the reverification of banks and payment service providers in the case of large transactions or after a period of constant transactions.
Introducing new layers of identity verification in contactless usage can help retailers stay one step ahead of criminals and better manage risk. Ultimately, tech companies have a responsibility to protect people’s money, data, and identity online. If all these actors come together properly, consumers will be able to get the most out of their digital identities and, of course, their payment options.
By Mariona Campmany, Digital Identity and Innovation Lead, Mitek
