- Emma Anderson
- July 27, 2021
Contactless cards gain popularity to reduce the inconvenience of entering pins for even the smallest transactions. The comfort was the reason for people to take the risk of not authenticating the payments. Moreover, there was a sudden spike in their demand after the pandemic struck the world.
More and more people signed up for the service to reduce the contact and maintain social distancing. However, contactless cards are about to face an existential crisis because of the latest payment solutions. Therefore, it is time to ask whether the new sensation in the market is about to go obsolete with a more secure payment method?
Digital Wallets – The Alternative of Contactless Cards
Digital wallets developed by the technology heavyweights such as Apple, Google, and Amazon are gaining the attention of the users. You don’t have to carry cards or cash in crowded marketplaces. Now, the smartphones in your pocket are more than capable of payment for heavy amounts.
You don’t have to worry about losing the card because of its small size. People take better care of their smartphones than their entire wallets. In addition, you carry your smartphone everywhere, even if you are not using it for payment.
Digital wallets are more secure than contactless cards for even the smallest payments. You need to enter the pin or authenticate with the biometrics to initiate the payment. Moreover, it will take only a few seconds to receive or send money through these wallets.
Trust in Favour of Digital Wallets
Technology will show promise only if the audience is trusting its application. We saw a meteoric rise in these contactless payment methods amid the pandemic. Now, users are trusting digital wallets more than debit cards for transactions.
It is among the most popular methods to buy products online because of the offered convenience. There are thousands in the UK alone that never trusted the cards but opening themselves to digital wallets. This is a major reason for the success of digital wallets as the users are concerned about security.
Simple Investment to Integrate Both the Methods
You can use the contactless card machine to receive payments from digital wallets. Customers can use the QR code, NFC tap, or other methods to pay for the items in their cart. Therefore, you don’t have to buy a separate machine to allow payment from digital wallets.
You can receive the payments even without the machine. The digital wallet application in your smartphone allows users to receive funds from other users. Moreover, it will also help the sellers to keep track of the received payments to avoid fraud.
Adjusting with the Time
There was once an era where these plastic cards stormed the market after their availability for regular customers. It took a while to create an infrastructure for these cards. After a few years, we can see their use everywhere, along with an ATM in every corner.
Now, the digital wallets are set to replace the cards the way they did with the cash. Sellers are adjusting to the customer requirements by offering them their preferred mode of payments. If not, you will lose many sales because they will find a seller accepting them in the next store.
Therefore, you need to remain updated with the latest requirement and preferences of the customers. If they want digital wallets, create an account and mention its acceptance on the website or counter front. If your budget is tight, we recommend you take out loans for bad credit with no guarantor, no fees, and instant decision.
Reasons for the Downfall of Contactless Cards
There are some serious concerns with using contactless cards that may lead to the downfall of contactless cards. It was offering comfort at the expense of security, low limits, and limited acceptance. We have explained these points in the section below to understand the situation better –
You don’t have to enter a pin or verify the payment with a contactless card. The merchant will use the card to tap on the payment machine, and the transaction is complete. It was the main objective of the card to offer more comfort to the users.
However, this also means the users are at risk of losing money if they lost the card. You should contact the bank as quickly as possible to block the transactions from the card. Therefore, you need to remain extra careful about the wallet if it has a contactless card.
2. Low Limits
The card providers tried to reduce the risk with contactless cards by offering a low limit. You cannot complete a transaction of more than a hundred pounds with the security pin authentication. It is another feature of the card that makes it to the list of both pros and cons.
The card is no longer contactless if you try to buy a product with a considerable price tag. Even the groceries often change to more than £1,000 if you are buying for the whole month. Therefore, the contactless feature will get used on limited occasions.
3. Limited Acceptance
Not every store in the UK has a machine that accepts contactless cards. They require an investment for the complete setup that small businesses often ignore. Therefore, you will end up using the traditional methods in the absence of modern machines.
After a few times, you will prefer to keep these cards at home to reduce the risk. It makes no sense to pay the annual fees of a service that gets rarely used. Instead, digital wallets are more popular with the availability of smartphones everywhere.
To sum up, the plastic cards in your wallet may soon get replaced by an application in your smartphone. Experts are predicting the unchallenged popularity of digital wallets in stores and businesses within the next few years. Therefore, contactless cards may not regain popularity because of the more secure and flexible alternative.