More Filipinos are growing used to contactless payments when buying in physical stores with their credit cards. As major card issuers in the Philippines like EastWest Bank have launched contactless cards, 37% of Filipinos (versus 27% in 2021) are now tapping, instead of swiping, their cards to pay, according to Visa’s 2023 Consumer Payment Attitudes Study published last year. The trend is seen rising steadily, as credit card companies gradually shift to Near Field Communication (NFC) chips from magnetic strips.

But before you tap away and join the contactless payment bandwagon, it’s important to know what it is and how it is used, as with any new technology. Eastwest shares this explainer as a guide when using tap-to-pay like its EastWest Pay app for cashless and cardless transactions.

“Contactless payment” is a fast, easy, and secure form of payment that does away with swiping or inserting a credit or debit card into a card terminal.

A contactless credit card uses radio frequency identification (RFID) technology (like those used in tollways) and near-field communication (NFC) to process transactions. When making a payment, you simply need to hover or tap your NFC-capable card over a merchant’s card terminal. The card emits short-range electromagnetic waves containing your credit card information to be captured by the point-of-sale system and processed to complete the transaction.

With the EastWest Pay app, credit card users don't even need to hold their physical credit card when making purchases. Instead, they can just tap their NFC-capable Android smartphone over a merchant’s POS terminal. This combines the benefits of a credit card and a contactless instrument like a mobile wallet, as the EastWest Pay app is linked to the user’s EastWest VISA credit card. This makes “tapping to pay” up to 10 times faster than using other forms of payment.

Your “traditional” credit card usually has three features: a magnetic strip on the back, credit card information printed on the card, and a built-in chip that permits you to “insert” or “swipe” your card into a card terminal. The magnetic strips store static information, such as account numbers, and are swiped through card readers.

On the other hand, a contactless credit card has a small, embedded chip emitting electromagnetic waves. You only need to place your card or your smartphone (when using EastWest Pay) a few inches away from a contactless-enabled POS terminal for your payment information to be transferred. Once the transaction is complete, the payment terminal will beep, display a checkmark, or flash a green light to show that the transaction is a success.

Consumers and businesses alike would benefit from contactless payment for these reasons:

Gone were the days when we thought swiping or inserting a credit card into a smart card reader was the quickest way to pay in a store. Then the payment through QR came along and we are told we only have to scan the QR code, enter the payment amount, and wait for the merchant to confirm that payment has been received. Until we found out we don’t have to do all these with contactless payment. Tapping to pay using a contactless chip can take only seconds.

“So, from the point of view of the business owner, he will be able to process and satisfy more customers,” said EastWest Consumer Service Delivery Head Efren Dela Cruz Jr.

The contactless card chip creates a one-time code for each individual transaction to accompany the payment information. This code is transmitted with your account number when you tap to pay. Since your name, billing address, and card verification code are not transmitted, it would be difficult for an unauthorized user to fraudulently complete a contactless payment.

When you swipe a card with a magnetic stripe, on the other hand, a simple skimming device can be used to fraudulently capture your payment and personal information.

If there is one security issue with contactless credit cards, it’s the physical possession of the card and skimming. Using the EastWest Pay app, however, cardholders need not physically carry a card and simply use an NFC-capable Android phone. The app also has added security features such as phone tracker, temporary locking and unlocking of the card, and tokenization of the card number.

“You don’t want anyone knowing your card number so what it does is it’s tokenized. It uses a different number whenever you transact and that number, no one can reuse it,” said EastWest Credit Cards Business Head Aylwin Herminia Tamayo.

Users need to nominate a six-digit PIN and even opt to enable biometric access (fingerprint or facial recognition) for added security.

Fear of physical contact rose during the last few years. It also made us conscious of the public surfaces we touch, which could potentially carry germs and bacteria. Using contactless payment helps us avoid these touchpoints.

Many overseas destinations, particularly in Europe and Australia, have airports and merchant stores with self-serve ticket machines using either a chip and PIN-enabled card or contactless payment. This makes paying for travel and related items more convenient and secure.

The EastWest Pay app has important and useful features for those always on the move. These include viewing of card account details and balances, transaction history, and a spending tracker.

For now, EastWest Pay only works for all variants of EastWest Visa credit cards (Visa Infinite, Visa Platinum, Visa Gold, and Visa Classic). However, EastWest is looking at including Mastercard, JCB, and debit cards as well soon.

To find out more about EastWest Pay, go to: https://www.eastwestbanker.com/pages/eastwest-pay.

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