{"id":767,"date":"2024-10-21T21:35:24","date_gmt":"2024-10-21T21:35:24","guid":{"rendered":"https:\/\/rembrandtai.com\/?p=767"},"modified":"2024-10-21T21:35:24","modified_gmt":"2024-10-21T21:35:24","slug":"contactless-payment-fraud-is-a-major-threat-to-consumers-financial-institutions","status":"publish","type":"post","link":"https:\/\/rembrandtai.com\/news\/contactless-payment-fraud-is-a-major-threat-to-consumers-financial-institutions\/","title":{"rendered":"Contactless Payment Fraud is a Major Threat to Consumers & Financial Institutions"},"content":{"rendered":"

Contactless payments have become a staple of convenience in our daily lives. Whether you\u2019re grabbing a coffee on your way to work, paying for groceries, or splitting a dinner bill with friends, the ability to simply tap your card or phone and go is something we\u2019ve all come to appreciate. However, as these payment methods gain popularity, they\u2019re also drawing attention from fraudsters who are quick to exploit new technologies for personal gain. In fact, by 2024, over a billion people are expected to use contactless payments regularly, with transactions projected to reach $10 trillion by 2027.<\/p>\n

So, let\u2019s dig into the ways these fraudsters are taking advantage of this technology and what you can do to stay safe.<\/p>\n

What Is Contactless Payment Fraud?<\/strong><\/h2>\n

Contactless payment fraud isn\u2019t just a simple case of card theft, it\u2019s an evolving set of tactics. One method, for example, involves \u201cskimming,\u201d where a device captures your card\u2019s information from a nearby terminal. Fraudsters may intercept digital wallet details through unsecure networks. As technology powering our payments evolves, so do the schemes used to abuse it.<\/p>\n

Here\u2019s a look at the primary methods that fraudsters are currently using:<\/p>\n

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  1. Simple Card Theft:<\/strong> If someone steals a contactless card, they can use it without needing a PIN for small purchases. In places like the U.K., fraud from stolen contactless cards rose by 82% in the past year. Once a thief has your card, they can use it repeatedly for smaller purchases until it\u2019s reported lost or stolen\u200b.<\/li>\n
  2. Skimming and Relay Attacks:<\/strong> This one is like something out of a spy movie. Skimmers can be hidden in ATMs or payment terminals to capture your card\u2019s details. Meanwhile, a relay attack uses an intermediary device to capture your card\u2019s signals, allowing fraudsters to make transactions even from a distance\u200b.<\/li>\n
  3. Account Takeovers (ATOs):<\/strong> With so much of our financial information stored in mobile wallets, these attacks are becoming more common. If hackers get access to your wallet app, they can essentially treat it as their own, making purchases or transferring funds\u200b.<\/li>\n
  4. Mobile Wallet Exploits:<\/strong> Apps like Apple Pay and Google Pay are fantastic for convenience, but fraudsters are always looking for vulnerabilities. They might intercept payment authorizations over public Wi-Fi networks or even manipulate app settings to authorize transactions you didn\u2019t make\u200b.<\/li>\n<\/ol>\n

    Who\u2019s at Risk?<\/strong><\/h3>\n

    The fact is anyone using contactless payments is a potential target. But those who use them more frequently – particularly in busy, urban settings – are at a higher risk simply due to the volume of transactions they\u2019re making. Young, tech-savvy consumers are especially vulnerable, as they\u2019re often early adopters of digital payment solutions.<\/p>\n

    How to Protect Yourself<\/strong><\/h4>\n

    Thankfully, there are simple yet effective measures you can take to protect yourself from contactless payment fraud. Here\u2019s what I\u2019d recommend:<\/p>\n

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    1. Set Up Alerts for Transactions:<\/strong> Most banking apps allow you to receive notifications for every transaction. If anything looks suspicious, you can catch it right away and contact your bank to shut down the card or account.<\/li>\n
    2. Consider Using Digital Wallets with Biometrics:<\/strong> With options like fingerprint or face recognition, digital wallets can offer an extra layer of security. Plus, they\u2019re more convenient than entering a PIN every time you make a purchase\u200b.<\/li>\n
    3. Try an RFID-Blocking Wallet:<\/strong> If you\u2019re using contactless cards, these wallets are a great way to keep your card\u2019s information safe from skimmers. They\u2019re designed to block any attempts to read your card unless you remove it from the wallet.<\/li>\n
    4. Monitor Your Bank Statements Regularly:<\/strong> Taking a few minutes each week to scan through your transactions can help you spot any charges you don\u2019t recognize, allowing you to act before it becomes a bigger issue\u200b.<\/li>\n<\/ol>\n

      For Businesses: Staying One Step Ahead<\/strong><\/h4>\n

      If you\u2019re running a business, you\u2019re just as vulnerable to contactless payment fraud as consumers are. Here are some steps businesses can take to stay ahead of fraudsters:<\/p>\n