UK-based neobank Revolut has implemented a Strong Customer Authentication (SCA) system that lets customers use their mobile banking app to authenticate their contactless card as they get close to reaching the new contactless transaction limit, avoiding the risk of having their card declined when they next attempt to make an in-store purchase.
“From 14 September, new regulations come into effect across the European Economic Area, limiting the number of contactless card payments you can make before needing to verify the payment,” Revolut has explained to customers.
“In short, you’ll be able to make up to €150 (or other currency equivalent) of contactless payments before you’re asked to either pay with chip and PIN, or log into the app to verify the payment.”
“Here’s what will happen when you approach the contactless limit,” Revolut says.
“We’ll send a notification to your phone, letting you know that you’re approaching the contactless payments limit (if you’re a business customer, you’ll get an email).
“At this point, you can either make your next payment via chip and PIN, or tap on the notification and reset your limit from the Revolut app (you will need to enter your PIN, or use fingerprint/face ID).
“You’ll then be able to make a further €150 (or other currency equivalent) of contactless payments until the next required ‘limit reset’.
“If you reach the limit without resetting, we’ll have to decline that payment, but we’ll send you another notification asking you to reset the contactless limit.”
“There are a couple of exceptions to these new rules,” Revolut adds.
“These include: Apple Pay and Google Pay — these won’t count towards your contactless payment limit, so try and use this on contactless terminals instead of the card. Also consider topping up via Apple/Google Pay where you can; Unattended terminals — These include parking and travel ticket terminals, and won’t count towards your contactless payment limit.”
The move follows the introduction of SCA, part of the EU’s revised Payment Services Directive II (PSD2) regulation, on 14 September 2019.
SCA requires contactless card issuers to require customers to re-authenticate their card with every fifth transaction they make or every time the total cumulative value of the transactions they have made since their last authentication reaches €150 — whichever comes sooner.
Rival neobank Monzo is tackling the issue by sending customers an app notification at the point of sale.
“Contactless payment is a simple and convenient way of making smaller payments, but if your card ever fell into the wrong hands —and you didn’t freeze it in time— it could be bad news,” Revolut explains.
“Keeping your account safe from fraud is a top priority for both ourselves and the regulators. Thieves and fraudsters work hard to trick you and steal from you, so while measures such as these can seem like an inconvenience, they can also make a huge positive difference when you need it most.”