PayWave and PayPass credit cards answered!

January 5, 2012 18 Comments »
PayWave and PayPass credit cards answered!

On Mozo Answers we’ve had a lot of questions about Visa payWave and MasterCard PayPass credit cards. As more and more providers are making “tap and go” a mandatory feature of credit cards, it’s important to know what it’s all about.

A common query that has popped up on our forum is around security and cover, such as “am I protected against theft” and “am I covered for fraud?” These are valid concerns and we’ve decided that it’s about time those lingering questions about “tap and go” credit cards are answered. Below are some of the most popular queries in regards to payWave and PayPass credit cards:

What is payWave and PayPass?
Almost all new credit cards come with either the Visa payWave or MasterCard PayPass feature. It’s a simple way of purchasing items under $100. You can either tap or hover your credit card up to 4cm away from the terminal and your transaction is processed without a pin or signature.

A lot of retailers are taking on this new payment method, to reduce waiting queues and cash handling. At the moment many of the large outlets have the “tap and go” option, such as Bunnings, JB Hi-Fi, Caltex, 7-11 and McDonald’s (and many more).

How it works: Visa payWave and MasterCard PayPass credit cards allow you to “tap and go” due to the embedded near-field communication (NFC) chip, which transmits your information to the POS terminal. There is also a radio antenna embedded into the credit card that sends radio frequencies, allowing contactless payments.

Is it secure?
It won’t be long until you have your first experience using a “tap and go” credit card. You’ll enter your local 7-11, go up to the counter and tap your credit card against the POS terminal, without a pin or signature. And you might ponder is this really safe?

There are several precautions credit card providers have put in place to protect you from any theft or fraud:

  • It has to be up to 4cm away from the reader, to ensure you don’t accidentally pay for another person’s transaction
  • The same transaction cannot be put through twice due to a unique authentication code for each sale
  • All Visa payWave and MasterCard PayPass credit cards use secure encryption (cryptographic key) technology, which gives you data protection and transaction security
  • It is always in your hand as the transaction is processed
  • “Tap and go” credit cards use the same network as swipe credit cards

It’s unlikely that any crim can do considerable damage using the “tap and go” option of payments under $100. However it’s important to be aware of your spending, by checking your transactions regularly and informing your bank of anything out of the ordinary. Most thieves will act in the first 48 hours, so the quicker you catch them out, the better.

Am I covered?
All the credit cards we looked at with Visa payWave and MasterCard PayPass are covered by a zero liability policy, which means you are protected against unauthorised transactions or fraud, with 100% reimbursement.

Most of the credit cards provide protection for in-store transactions, online transactions, phone transactions, and overseas and domestic transactions. It’s important to check your monthly statement for any fraudulent activity because some providers state that it has to be reported within a reasonable period of time (and this can vary with providers).

Watch out for exclusions of cover! Some zero liability policies don’t provide cover for ATM and Eftpos transactions.

Can I disable the paywave/pass feature?
Unfortunately, the short answer is no. You can’t disable the payWave or PayPass feature on your credit card and most replacement credit cards come with the feature.

It is a reality that the “tap and go” credit card option is going to be used in most retail outlets in the future. Did you know there’s even going to be a credit card released that you can use to “tap and go”? As technology changes the Mozo team is here to give you the facts. If you still have any queries about payWave and PayPass credit cards check out the Mozo credit card payWave and PayPass guide.

“”New update”"

With credit card signatures coming to an end on 1 August 2014, check out our more recent blog here to see how it will affect you.

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Rebeccah Elley

Rebeccah Elley

Rebeccah is Mozo’s lifestyle and money writer, an avid lover of the digital space. Whether she’s creating a mega money guide or fun-filled blog her aim is to make finance simple and pass on her money hints and tips to the Aussie public. Follow Rebeccah on Google + RebeccahElley

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18 Comments

  1. Andrew Donald April 19, 2013 at 2:31 pm - Reply

    The CBA couldn’t even tell me the name of a merchant that made a transaction on my debit card by Paywave. They said if I wanted to dispute it, they would cancel my card and reissue it, which would be very inconvenient. I can’t believe they put through transactions on your account, and cannot identify the merchant or transaction date on request.

  2. daniel j August 27, 2013 at 3:53 pm - Reply

    not much damage? thats a load of rubbish! when my wallet was stolen using only paywave the theives ran up a weeks waves in an hour and a half when i realised it was missing

  3. Lance P November 14, 2013 at 1:18 pm - Reply

    This is absolute rubbish. If you don’t want paywave you shouldn’t have to have it. Visa and MasterCard should not be able to force it on you. At the very least with todays technology yoju should be able to at least reduce the limit. But no you cant even do that. Maybe the ACCC should act to protect our right to choose what services we want provided.

  4. Sean Heron December 13, 2013 at 6:04 pm - Reply

    My limit on my credit card is $1000 per day so they can do 10 transactions at $100 per transaction easily within 1/2 hr, the time it takes to report my card lost or stolen. I won’t carry $1000 in my wallet but these people carry these cards.

  5. Paul February 18, 2014 at 10:17 pm - Reply

    Not a fan or paywave or pay pass. Would like the choice to have on card or not.. Not a bad idea for those who carry it at all times in wallet. And do not want a pin But I have other backup cards I like to carry in another location. Eg suitcase, work draw, And in a nutshell prefer to use pin at all times.
    Just cancelled my Visa card and use eftpos debit card, then paypal.
    Can I sign up for the Chinese union card anywhere locally .this card requires a pin and signature. Commonwealth bank merchant terminals in Aussie stores will soon be able to process union cards for the increasing amount of Asian tourists. Like idea of them having pin, signature rather than
    paywave,pay pass.

    • admin
      Mozo February 20, 2014 at 1:26 pm - Reply

      Hi Paul,

      Looks like you’ve done your homework already! UnionPay cards have yet to introduce contact-less payment technology so payments via PIN and signature are still the norm with these cards. However, UnionPay operates under the approval of the Chinese state government so there are very few international banks who have the authority to issue a UnionPay card.

      If you’re super keen on getting your hands on a UnionPay card, you can try applying through the Bank of China which has branches in selected locations in Sydney, Melbourne, Brisbane and Perth. Keep in mind that the Bank of China does not offer credit cards in Australia, so the only option is sign up for a debit card with UnionPay functionality. This card attracts fees and charges that mainstream banks do not have so make sure you read the full product disclosure statement before signing up.

      All the best!

      Team Mozo

  6. Bee April 9, 2014 at 7:10 am - Reply

    Definitely not happy about this decrease in security on my card, and no freedom of choice as to whether I want it or not.

  7. Tiffany April 9, 2014 at 5:14 pm - Reply

    Just disgusted that I have no choice about enabling/disabling this facility. All the hype about how secure these are is total rubbish. I dropped my card one day last week and it was picked up and used six times within half an hour! Fine you say! the bank will reimburse you, you say! That doesn’t help me when I am in my nearest town which is 400km from my home. When I needed that money to pay a traffic infringement that day as it was almost the last day. When I needed that money for fuel for the journey home. When I needed that money to buy my groceries for the coming month. Fortunately I discovered the loss of the card in less than an hour or I shudder to think how much I would have lost. One of the places the card was used (a liquor store – surprise!) located the transaction on their CCTV system and identified the person using the card – they burnt the footage to a cd for me – the bank and police were not interested in pursuing the matter at all.

  8. Tim May 13, 2014 at 10:06 am - Reply

    Seems stupid to me that we can no longer use a signiture for or purchese, that a pin is now required for security (This I totally agree with), yet we have something as unsecure as paywave being allowed.
    If you do not notice that you have lost or had your card stolen, how do you prove that some scum thief was the one making purchases.
    Personally only need a credit card for PayPal purchases, so I have distroyed the card and keep the bits in my safe.
    I will never carry a card in my wallet that has this stupid feature.
    Looks like I will be going back to the stone age and have to start using the stuff, whats it called?…Money

  9. Trevor May 14, 2014 at 2:49 pm - Reply

    Ithis is a stupid idea and I don’t want it. But the card people say I am the only one in the whole world that doesn’t want it. Ring them and demand to have a choice, pester them with phone calls and we just may wear them down. Good luck

  10. Martin May 22, 2014 at 8:42 am - Reply

    All these concerns over stolen c/c’s are just as valid for ANY card, not just those with paywave, etc. If you have a card without the chip and it gets stolen, it’s still possible to rack up huge payments on it – all the thief needs to do is jump on the internet and use the card. So, the issue of a stolen card is NOT an issue with the technology, but with best practice.

  11. Joe June 13, 2014 at 10:19 am - Reply

    Paywave has got to be the most idiotic idea ever conceived. I have it disabled on my debit card, but Visa seems to refuse to allow it to be disabled.
    A lot of damage can be done in a short time.
    I don’t check my wallet every half hour to make sure all my cards and ID is still there. I have dropped my wallet unknowingly before. I’d hate someone to pick it up and use my credit card. They claim I’m protected, but I suspect that it would be a tough fight.
    I want the choice to have it disabled. It is definitely NO feature.
    Let’s ALL complain to the credit card companies. Make them let us have the choice.

  12. Mag July 4, 2014 at 8:38 pm - Reply

    I rang westpack awhile back when I found out my next new mastercard will have pay pass and told then I didn’t need it or want it and the reply I got was good luck with that they all will be issueing that feature real soon and there is no choice by the users. He was very rude and arrogant and I think it’s discusting that we the card owner can’t even choose what we want. The banks should be ashamed of themselves for taking away our right to say no or yes to these stupid bloody pay pass cards. Wake the hell up to yourselves and give us our rights as Australians back . It’s going to cost us all a lot of money at the end of the day .

  13. Michael August 7, 2014 at 11:12 pm - Reply

    Is it ok for shops to set a $10 min spend on paypass, I thought the whole point was if you had no loose change

    • admin
      Rebeccah August 8, 2014 at 10:33 am - Reply

      Hi Michael,

      The industry standard is that there shouldn’t be any minimum spend requirements but this appears to be up to the individual merchant.

  14. Pooley September 20, 2014 at 4:18 pm - Reply

    I was lined up at Bunnings about to pay for some products and when I tried the tap and pay the checkout guy said it already been paid. Turned out to be the guy standing behind me that paid. Big stuff up after that as I had to pay him the costs by withdrawing cash from an ATM. Making payments quicker?? In your dreams it took me over an hour to sort it all out.
    I now stand well back from registers to prevent it happening to me.

  15. Charles Hubbard November 5, 2014 at 8:12 am - Reply

    How do these (Visa PayWave and Mastercard PayWave and PayPass) differ from Softcard.

    Which one would you suggest i go for and why?
    Thanks

    • admin
      Rebeccah November 5, 2014 at 8:31 am - Reply

      Hi Charles,

      PayWave and PayPass allow you to tap and go with your debit/credit card. Whereas Softcard is a digital wallet, which allows you to tap and go with your smartphone. Both options use near field communication (NFC) to connect with the terminal, so the only real difference is choosing between paying for purchases under $100 with your debit/credit card or with your smartphone.

      From what I can see Softcard is only available to US customers at the moment. However we did write a blog on digital wallets available in Australia: http://mozo.com.au/blog/2014/08/digital-wallet-gimmick-great-gadget/

      I hope this helps

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