MANILA, Philippines – Before, the protocol when using your credit card was a tedious one: you give your card to the cashier, and then she swipes it through a credit card reader. She asks you to enter your pin, you wait for it to be authenticated, they print a receipt, you sign it, and you’re done. But thanks to new technology, contactless payments where you can simply tap your card on a terminal to pay for any purchase are now possible.
Citi Philippines and Visa recently introduced the first contactless credit card-payment technology in the country with Citibank Visa payWave. According to consumer business manager for Citi Philippines Bea Tan, “This particular technology provides convenience to our customers as well as security.”
How it works
These cards are embedded with an EMV chip that contains all your information. Meanwhile, embedded within the plastic of the card is an antenna that makes contactless payments possible. Just like a typical-credit card transaction, the cashier would have to enter your purchase amount. Once everything is final, the customer simply needs to place the card above or on the terminal, wait for a confirmation beep, and the purchase is done.
According to Tan, transactions below P2000 will not require the customer to sign a receipt or enter a PIN. They also have the option to collect the receipt or not. Transactions above P2000, however, will require a PIN.
Need for speed
According to Iain Jamieson, Visa country manager for the Philippines and Guam, contactless transactions are 30 percent faster than normal credit-card transactions. And, he predicts, “With brands where speed is of importance, you will see them converting their terminal infrastructure to terminals that will be able to take contactless transactions.”
For now, contactless payments via the Citibank Visa payWave are accepted at Coffee Bean and Tea Leaf, Mercury Drug, Robinson’s Supermarket, Eastwood and Lucky China Cinemas, and soon at Newport Cinemas and branches of McDonald’s. Jamieson says they’re looking to expand to other merchants very soon.
In September of 2012, Budget and Management Secretary Florencio “Butch” Abad represented the Philippines at the Better Than Cash Alliance (BTCA) and the Open Government Partnership (OGP) in New York. The point was to raise awareness on the benefits of replacing physical cash with electronic payments. Contactless payments, says Jamieson, is a step in this direction.
Increased security
Typically, credit cards have that distinctive magnetic stripe located at the back. Contained within this magnetic strip is all your personal information. It also makes your card susceptible to fraud through an illegal practice called “skimming.”
“Data on the back of a magnetic strip is static,” explains Jamieson. “It’s always the same. With those cards, you do get instances of the card being skimmed as they take the data off the magnetic stripe.” But the difference with cards that contain an EMV chip is that “every time a transaction occurs, the data is dynamic; it changes. So you can’t clone or skim a chip card.”
Those chip cards are only the beginning. “The thing about payWave technology is that it can come in different forms,” says Jamieson. In Singapore, for example, they have a chip card embedded at the back of their smart phone. This way, they merely have to wave their phone above a terminal to pay for their purchases. “The technology has the ability to jump into form factors: mobile phones, debit cards, prepaid cards.”
Check out how contactless payments work through this video by Visa Australia:
- Rappler.com
Peter Imbong is a fulltime freelance writer, sometimes a stylist; and on some strange nights, a host. After starting his career in a business magazine, he now writes about lifestyle, entertainment, fashion, and profiles of different personalities. Check out his blog,Peter Tries to Write.
The future of money is contactless payments
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