A brief guide on contactless NFC debit cards.
There is no doubt that debit cards make banking easy. Sleek and easy to carry, these cards help you make payments when you are short of cash. You can also withdraw funds from your Bank Account at any time with the help of your ATM-cum-debit cards. With evolutions in the banking industry, the modern debit card is the updated version of the standard card with a magnetic strip. Yes, today, banks provide contactless debit cards. Here is all you need to know about them.
A contactless debit card is a card encrypted with Radio Frequency Identification (RFID) or Near-field communication (NFC) technology. Also known as the NFC debit card, it is the latest development in secure payments technology, which allows debit cardholders to pay for their transactions without physically handing over the card to the payee.
The RFID technology in contactless debit cards allows the card to communicate with a card reader when the payer or payee holds the card near the card reader for a transaction. The card typically comes with an EMV (Europay, MasterCard, and Visa) chip with the usual details such as the card number, expiration date, CVV, signature strip and magnetic strip.
When you hold the contactless card against the card reader or payment machine, the card authenticates your card information securely. At this point, the point-of-sale system or retail merchant sends your transaction details to the card-issuing bank, which analyses the transaction and approves it.
While these steps may seem complicated, it takes less than a minute to complete the entire transaction.
Essentially, the contactless debit card allows you to make payments without having to swipe the card at retail and other PoS platforms. You can complete transactions securely by holding the card or tapping it on contactless-enabled card readers. The card reader encrypts the card details, the payee enters the amount due, and the payment is completed in seconds.
Recognising a contactless debit card is easy. All contactless cards contain the Wi-Fi symbol either on the front of the card, under the bank name or card type (Visa, Master, etc.), or on the flip side, near the magnetic strip. The contactless symbol is represented by four curved lines, increasing in size as they move from left to right. This symbol is perhaps why many banks also refer to the contactless card as the Wi-Fi debit card.
Most banks allow contactless payments without entering the secret PIN for transactions up to INR 2,000. In case of transactions exceeding INR 2,000, you must authenticate them by entering the PIN.
Now that you know what is contactless debit card you can request your bank for one. Alternatively, your bank may automatically assign a contactless card when your current card expires. Incredibly convenient and secure, the NFC debit card works ten times faster than swiping, inserting in slots or using cash.
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*Disclaimer: This article is for information only. We recommend you get in touch with your income tax advisor or CA for expert advice.