Magnetic stripe cards were widely popular around 20 years ago, but they lacked security and data encryption, making them vulnerable to skimming and cloning. Chip-based cards emerged as a more secure option, requiring insertion into payment terminals and authentication with a PIN. The NFC standard, which evolved from RFID, has become a new payment standard, allowing users to make contactless payments by tapping an NFC-enabled payment device. Both contactless cards and phones can serve as payment methods through NFC technology.
NFC payment operates similarly to Bluetooth, utilizing radio waves to activate and verify the transmitted data. While it is more secure than other wireless communication methods, it is still susceptible to specific forms of cyberattacks, such as man-in-the-middle (MITM) attacks. However, due to the close proximity required for NFC to work, skimming attacks are less viable.
While NFC technology offers enhanced security for contactless payments, it is not infallible, and vulnerabilities can still be exploited by malicious actors. NFC payments are convenient but lack additional authentication, potentially allowing for fraudulent transactions if a card or phone is stolen. Services like Apple Pay and Google Pay require additional security measures, such as biometric verification, making them more secure for making payments.
To make contactless payments more secure, users can employ methods such as using RFID blockers, setting low payment limits, using phone payments, using cash, and avoiding enabling payments on smartwatches. Additionally, obtaining a travel card to pay for tickets can mitigate the risk of unauthorized transactions. While no security solution is foolproof, taking small, simple steps can reduce the likelihood of experiencing payment-related misfortune.