Bank cards, mobile phones, smartwatches: Make contactless payments: All you need to know

bank card, mobile phone, smartwatch
Making contactless payments: What you need to know

11/01/2022, 6:59 PM

Cashless payments are now widely established, a current study shows. However, no one is always safe from harm. What’s important when it comes to digital payments.

The trend towards less cash has been evident for some time, but the coronavirus pandemic has accelerated growth. Meanwhile, the technological possibilities of the future have arrived and in addition to paying with your bank card, the watch or mobile phone has also become a reality as a source of money.

a real bitcoin studies shows that in the third quarter of the year, 90 percent of citizens made contactless payments at least once, and half of the country uses this option more often (several times a week). 46 percent of Germans use their mobile phone or smartwatch, with 74 percent between the ages of 16 and 29.

Mobile Payments Is Simple – Once You Know How

To be able to make payments from a smartphone or smartwatch, the respective end device must have an NFC chip. NFC stands for Near Field Communication and describes the function of the chip, which can communicate wirelessly with authorized recipient devices. Not all cell phones have such chips, but in theory many Android smartphones and sixth-generation iPhones from 2012 are equipped with NFC technology.

Activation works differently depending on the device and operating system generation. Simply searching for “NFC” in the settings will do the trick in most cases. In theory, the account of a payment app such as Apple Pay, Google Pay or, meanwhile, many banking apps should be linked with NFC technology. However, banks in particular sometimes need a little time to update their apps to the latest hardware generation.

How secure is NFC?

Although the NFC standard is now a ten year old technology, in most cases it works smoothly and has proven itself over the years. As two NFC devices communicate with each other, a code is generated that encrypts the communication and cannot be copied. “Said” resides under the customer’s smartphone and supermarket checkout, so to speak. NFC function is now often standard for bank cards as well.

To protect yourself from potential misuse, the Consumer Advice Center recommends storing NFC-enabled bank cards in a protective cover that makes unwanted radio communications impossible. With smartphones and smartwatches, you have the option to authorize payments by PIN, fingerprint or FaceID, or to set an upper limit for payments. However, because communication only occurs in close proximity and is automatically interrupted as soon as more than two NFC chips communicate with each other, it is very difficult for criminals to abuse the technology.