UK Shoppers Getting Spooked By Phantom Contactless Charges

Consumers are checking online statements only to discover they've fallen victim to fraud. But upon further investigation, it turns out they've actually been hit by a contactless card phantom.

According to This Is Money, customers all over the UK have been reporting accidental payments being charged on their contactless debit or credit cards without knowing.

Earlier this month, Marks and Spencer shoppers complained they were being charged, even when standing over a foot away from the reader. Consumers dining at the café chain Pret A Manager also claimed they noticed unauthorized charges on contactless accounts.

The Guardian reports that several hundred Londoners complained bus fares were being taken from their contactless cards while they were swiping their Oyster cards.

These reports only account for those who actually noticed the small £1.40 missing from their accounts. Others could be paying extra bus fares without ever realizing what’s happened.

The UK has over 232,000 contactless terminals, including retailers such as M&S, Post Office, Starbucks, Boots, Pret A Manager, McDonald's, Waitrose, Caffe Nero and Subway. There are about 32.5 million registered contactless cards with 70 million payments made since its launch.

Customer reports regarding charge errors have been extremely low up until recently. With imminent plans to expand the service onto the London Tube, overground and Docklands Light Railway, financial institutions had better figure out a solution fast.

Until technology has been improved, UK consumers have been given fair warning on how to actively void accidental payments in the future.

According to The Guardian, the Transport for London has told travelers to store Oyster cards and contactless cards in separate wallets or purses. This will help to avoid clashing unwanted cards near the NFC reader.

The Guardian reports the TfL stated, "Our advice is to choose which card they want to pay with, and to keep it separate when touching it on the reader, so that they pay with the card they intend to use."

TfL reported they would be launching a mass advertising campaign that will reiterate this message to all people using London transit.

The position of how the reader is placed has also been proposed as contributing to the problem of phantom charges. If they are close to the shopper's waist level, it is easier for the wrong card to be charged.

Some shoppers complained they were completely unaware they even had a contactless account. It is now common for banks to automatically provide contactless-enabled cards with any account upgrade or card replacement.

Contactless cards were issued to make small payments quick and easy, and to avoid fraud.  Retailers and banks have insisted the problem is not the technology's fault, but until the system is improved shoppers should stay alert.

Go on contactless shoppers - just proceed at your own risk.

To read the full story at This Is Money click here or The Guardian click here.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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