For merchants and consumers, speed, convenience and safety does matter. We see that through the adoption of our PayPass contactless payment technology, as European retailers both large and small are using MasterCard PayPass at their point-of-sale, providing consumers with an innovative alternative to cash for their everyday purchases.
That said, there are some stories circulating in the media that are calling security into question. MasterCard takes security very seriously and fundamental to the technology behind PayPass are the built-in safeguards that ensure cards cannot be easily compromised. For example:
- During the transaction process, there are encrypted, dynamically created security codes that must be validated by the card acceptance device or by the issuer of the card in real-time. This helps ensure that only transactions from valid cards are approved; and
- MasterCard does not allow card issuers to encode cardholder name on the PayPass chip on the card – so no worries about your name being captured.
There are also numerous required and recommended security features to help identify and block fraudulent transactions:
- Visible card features such as the hologram and three digit code (CVC2) on the signature panel of the card; and
- MasterCard SecureCode, which provides online retailers and issuers an additional layer of cardholder authentication.
As you can see from other MasterCard blog postings by Oliver Manahan and Randy Vanderhoof, there have been demonstrations where the card number and expiration date have been scanned by a card reader without the knowledge of the cardholder. These controlled experiments have not materialized in the real world as a fraud threat.
However, these demonstrations do underscore the need for retailers and card issuers to be vigilant in adopting available risk management techniques, which when used in combination, dramatically decrease the possibility of fraud occurring. Cardholders play a role too as they should be discreet when entering the PIN code, and report missing cards and unauthorized transactions to the card issuer as soon as this is discovered.
Cardholders can rest assured that MasterCard also values speed, convenience and safety. Today, PayPass cards and devices can be used at approximately 425,000 retail locations in 37 countries around the world including 20+ European countries. We continue to invest significantly in PayPass and work very closely with card issuers and retailers to maintain security at the highest levels.
If you have any questions, drop them in the comment box and we’ll be happy to address.