Unlimited contactless cards may lead to spending sprees
Summary
The article discusses the possibility of banks in the UK allowing unlimited spending on contactless cards, which might lead to more impulsive buying. Currently, entering a PIN for purchases over £100 helps people control their spending. The financial regulator is considering allowing banks to decide their contactless limits, sparking debate on its impact on consumer spending habits.Key Facts
- Contactless cards allow purchases without entering a PIN, up to a certain limit.
- The UK financial regulator is considering letting banks set their own contactless spending limits or remove them altogether.
- Currently, people have to enter a four-digit PIN for transactions over £100.
- Contactless payment limits in the UK increased from £10 in 2007 to £100 in 2021.
- Some experts believe removing the PIN requirement might lead to more impulsive buying and increased debt, especially with credit cards.
- Contactless technology is widely used, with nearly 95% of eligible in-store transactions predicted to be contactless by 2024.
- Many customers now use digital wallets on smartphones, which already allow unlimited payment due to added security like fingerprints.
- There is debate on whether removing the contactless limit is necessary with the prevalence of smartphone payments.
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