Home > Posts > Online Payments > What is Contactless Payment System and How Does It Work

What is Contactless Payment System and How Does It Work

Contactless payment was announced in 2007 and it is popular since then, you may hear about the system and wondered if it is useful or not. So in this article, we will tell you what is that system, how does it work, and whether it useful for your business or not. 

What is Contactless Payment System

The contactless payment system was invented in 2007 and became popular since then, in the US there are 112 million contactless cards and simply Contactless payments are payments made by waving or tapping your contactless device, usually a card or smartphone over a reader, which then accepts the payment.

Also, the contactless payment card is rapidly becoming the standard for debit and credit cards have NFC technology that allows the customer to pay for items by tapping or passing their card above the payments reader. These types of cards are called contactless payments cards.

How does Contactless Payment Work

Contactless credit cards have a chip inside them that emits radio waves. An antenna is built into the plastic to secure the connection with a contactless reader. This is known as radio frequency identification (RFID) technology.

To pay for something with a contactless credit card, you hold the card near a payment terminal (known as an RFID reader) and it picks up the signal, communicates with the card and processes the payment.

The payment terminal will say if the payment was successful or not. Sometimes it doesn’t work, and you’ll need to use your pin instead.

Mobile phones and other electronic devices use something called near-field communication (NFC) to transmit data which is based on the technology used in RFID.

Types of Contactless Mobile Payments

Android Pay

Android Pay is Google’s mobile wallet technology and one of the more popular NFC mobile payment apps. It is available on all NFC-enabled devices that run Android version 4.4 or later. To use Android Pay, customers just open the app on their phone (which requires the user to have a secure lock screen) and complete the transaction by holding their device over the payment reader.

Samsung Pay

Samsung Pay works on newer versions of Samsung Galaxy devices. Samsung Pay also works on NFC contactless readers. As opposed to Android Pay and Apple Pay, to trigger an NFC contactless payment with Samsung Pay, you swipe up from the home screen. As of version 2.5, Samsung Pay can also be used to pay for things in-app.