Contactless card may spell the end of shopping with cash – but not yet
Hi-tech payment system may be the future, but finds plenty of teething problems
They've been touted as the next big thing that could render cash a thing of the past, but do contactless payments really make purchases faster and easier?
Smart Consumer decided to check out the new technology that allows you to make small purchases by waving your debit card over a reader without having to enter a PIN. It's supposed to make buying everyday items quicker – but how does it work in practice?
Initially we assumed we'd need to apply to our bank for a new card – in fact we were surprised to discover it's ready and waiting to be used on the Visa Debit card we got a few months ago.
If your debit card has a wireless signal on the right-hand side that's like four bracket signs of gradually increasing size, then you're already equipped to make contactless payments.
The cards allow you to make purchases of up to €15 simply by waving your card over the instore terminal –with no entering a PIN code or waiting for authorisation.
The next step is to find somewhere to use it. My first attempts end in failure, with assistants in a couple of stores totally bemused and with no idea what I'm talking about.
The technology is still in its infancy in Ireland, and not many retailers have installed it, with Arnotts, Marks & Spencer, Boots, and some Insomnias and Centras the main ones so far.
So next stop is a Centra that we've been reliably informed uses the technology. Trouble is, the shop assistant doesn't seem too sure about how it works – but eventually says we can do it on the other till.
Then we're informed the store has a €5 minimum purchase condition for contactless purchases – and the salad dressing we're buying only costs €2.19. We protest that this defeats the purpose of this payment method – and eventually the manager agrees to make an exception.
By holding the card over the reader, the payment is entered, and the deduction duly turns up on our bank statement the next day.
An attempt to buy a coffee contactlessly at a local Insomnia outlet proves unsuccessful – the chain has rolled it out at its own coffee shops, but not its franchise outlets. Dublin's IFSC proves more fertile ground – we buy a cappuccino in Insomnia, and at Marks & Spencer the assistant says everyone in the financial district now uses it.
Boots chemists have also rolled it out and we find it seductively easy to make impulse cosmetics purchases on it. One of the dangers of this technology is that you don't have the barrier to spending of watching the cash in your wallet run out.
But there is a maximum of three payments of €15 each which can be made in a day before anti-fraud safeguards kick in and you're required to enter your PIN code.
Your bank currently doesn't charge you for making a contactless payment, but that's set to change. Bank of Ireland announced it will bring in a 15c charge per transaction on contactless payments next year, while AIB said that while currently it has no charge for them, it will soon review this policy.
A 15c charge on a €3 cup of coffee represents a 5pc surcharge for a minor convenience – and would definitely put Smart Consumer off using this payment.
PROS: You don't have to go off hunting for an ATM if you're out of cash.
CONS: Not many shops have it yet: and when bank charges kick in, it will be an expensive way of spending money.