PETALING JAYA: There is an urban legend which says credit/debit cards can be cloned if unscrupulous characters with a card reader get close enough to your wallet or handbag, often leaving the cardholder the unknowing victim of fraud.
However, this is simply not true, according to the country manager of Visa Malaysia, Ng Kong Boon (pix).
In a recent interview with SunBiz, Ng said almost 50% of the transactions handled by Visa in Malaysia are done via contactless payments, and all of these are completely secure.
But, first, what are contactless payments?
Contactless payments use ultra short-range wireless technology to securely complete payments between a contactless card, payment-enabled device or wearable and a contactless-enabled checkout terminal. This means that contactless cards or devices need to be 2.5-5cm from the terminal in order for a transaction to be initiated. Additionally, it generates a unique cryptographic code that changes for every contactless transaction.
It is precisely this need for close-range contact that makes it virtually impossible for fraudulent transactions to be done, Ng explained.
He also said on the back end, Visa has multiple layers of controls that every transaction goes through to ensure security.
“To date, we have not seen any fraudulent transactions arising from contactless payments through electronic pickpocketing. Visa cardholders benefit from multiple layers of security that work behind the scenes with every transaction.
“Payments are secure because each transaction is accompanied by a one-time code that protects consumers’ payment information. Every Visa payment product is protected with security at the card, terminal and network levels.
Secure protocols, artificial intelligence, real-time analytics, cryptographic algorithms and many more layers work together to prevent fraud. Visa has been able to keep global fraud rates stable and near historic lows of less than one-tenth of one per cent,” he said.
That said, according to Ng, there are a few common measures consumers can take to prevent falling victim to fraud. These include never sharing PIN numbers with family, friends or strangers, or writing it down on a piece of paper or behind their cards.
At the same time, cards should always be kept safe and secure, and consumers should also subscribe to transaction alerts to be notified via SMS once they make a payment on their card.
Meanwhile, Ng said it is the seamless convenience and security that contactless payments offer to consumers which has led to its increased adoption in Malaysia.
“Contactless payments allow a seamless payment experience for consumers and it is fast and easy. As contactless payments are targeted for low ticket payments below RM250, there has been a surge of debit card contactless transactions since the Chip & PIN initiative was implemented. With debit cards enabled with contactless payment capability, more Malaysians have been using this method of payment, which leads to less cash usage in the country, especially for low ticket transactions,” he said.
According to Visa’s Consumer Payments Attitudes Survey 2019, contactless cards are starting to gain momentum in Malaysia, with 83% of Malaysian respondents using contactless card payments more frequently than they did two years ago.
“Malaysia is one of the fastest-growing countries in Asia-Pacific in terms of contactless payments penetration,” said Ng, adding that there is now an 80% merchant acceptance rate in the country and Visa is constantly expanding their merchant acceptance footprint.
He explained that contactless payments acceptance is important because it sets the infrastructure for mobile contactless payments including Samsung Pay and Apple Pay.
“Mobile payment services are making digital payments even more accessible to consumers globally, resulting in an increasingly cashless world. Visa is bringing all mobile payment options to everyday merchants so that no matter what device a consumer may have in their pocket, they can use mobile payments at payment terminals,” he said.
In addition to the other mobile payment solutions it is compatible with, Visa will be announcing its partnership with Fitbit to enable contactless payments via Fitbit smartwatches later this year.
“In partnership with the wider industry, Visa constantly adapts, enhances and evolves its payment solutions to identify and address new risks. We are committed to delivering the best possible customer experience to our 3.4 billion cardholders with enhanced security,” said Ng.