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UK Set to Eliminate USD134 Contactless Payment Cap
(MENAFN) Britain's £100 (approximately $134) ceiling on contactless card transactions will be eliminated next year, potentially enabling consumers to make unlimited tap-and-go purchases without pin verification, following a regulatory overhaul announced by financial authorities.
The Financial Conduct Authority (FCA) declared on Friday that starting March 19, banking institutions and card issuers will gain autonomy to establish their own contactless payment thresholds.
Currently, contactless card transactions face a £100 cap, though mobile phone-based payments operate without such restrictions.
An additional cumulative threshold of £300 or five consecutive contactless transactions also exists, beyond which cardholders must input their pin.
The updated framework will permit providers to eliminate this cumulative restriction at their discretion.
The FCA stated the revisions would empower financial firms to adapt to evolving consumer preferences, inflationary pressures, and emerging technologies. The regulator emphasized that customers should retain the ability to configure personalized limits or disable contactless functionality altogether.
In the immediate aftermath, the regulator anticipates most providers will maintain existing safeguards.
Contactless payment technology debuted in 2007 with a £10 threshold, which expanded incrementally through subsequent years.
The cap increased to £45 amid the pandemic in 2020, then jumped to £100 in October 2021. Consultation regarding these latest modifications commenced earlier this year.
The FCA clarified the policy shift will exclusively apply to banks and card providers demonstrating robust fraud prevention systems.
Current consumer safeguards will persist, including full reimbursement for victims of unauthorized fraud, such as instances involving lost or stolen cards.
The Financial Conduct Authority (FCA) declared on Friday that starting March 19, banking institutions and card issuers will gain autonomy to establish their own contactless payment thresholds.
Currently, contactless card transactions face a £100 cap, though mobile phone-based payments operate without such restrictions.
An additional cumulative threshold of £300 or five consecutive contactless transactions also exists, beyond which cardholders must input their pin.
The updated framework will permit providers to eliminate this cumulative restriction at their discretion.
The FCA stated the revisions would empower financial firms to adapt to evolving consumer preferences, inflationary pressures, and emerging technologies. The regulator emphasized that customers should retain the ability to configure personalized limits or disable contactless functionality altogether.
In the immediate aftermath, the regulator anticipates most providers will maintain existing safeguards.
Contactless payment technology debuted in 2007 with a £10 threshold, which expanded incrementally through subsequent years.
The cap increased to £45 amid the pandemic in 2020, then jumped to £100 in October 2021. Consultation regarding these latest modifications commenced earlier this year.
The FCA clarified the policy shift will exclusively apply to banks and card providers demonstrating robust fraud prevention systems.
Current consumer safeguards will persist, including full reimbursement for victims of unauthorized fraud, such as instances involving lost or stolen cards.
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