[LINK] refusing contactless cards

[Paul Brooks]

On 1/08/2013 5:37 PM, Harry McNally wrote:
> I assumed (perhaps incorrectly) that the fast response of PayWave meant it was 
> not authenticating the transaction in real time. So it's not clear to me how 
> the transaction limit will prevent loss (or theft). If the transaction is 
> later declined then the merchant has a loss.
No - if the transaction is later declined after the bank terminal gave the green light
for the customer to walk out with the goods, then the *bank* has the loss, not the
merchant.

The banks have fairly large provisions for reimbursing fraud, should it occur - which
is why they are pushing the chip/pin/wave model. They have significantly lower levels
of successful fraud with the technology, requiring lower levels of reimbursement, than
the old magstripe and signature models.

Another thought - with the contactless model, the bank can't use the 'you wrote the
PIN on a piece of paper in the wallet - so you were negligent and we're not
reimbursing you' defence.

P.