EMV systems are capable of three different transaction types: contact, contactless, and mobile. Contact and contactless payments use EMV smart chip cards, while mobile payments use mobile wallet applications on smartphones.

What are EMV contactless payments?

Contactless payments use an EMV smart card and a contactless-enabled terminal. In this kind of transaction, the card and terminal communicate wirelessly using NFC. Contactless payments offer a balance between the security of EMV transactions and the speed of traditional magnetic stripe transactions.

Process

To begin a contactless payment, the card user taps his or her EMV card against the terminal. The card user is then free to put the EMV card away; unlike in contact payments, the card does not need to remain in (or near) the terminal for the duration of the payment.

The transaction will proceed in much the same way as traditional magnetic stripe card transactions proceed. Once the transaction is initiated, the cardholder will be verified and the transaction will be approved.

Compatible CVMs for EMV contact payments

Contactless payments are compatible with three cardholder verification methods: online PIN, signature, and no CVM. Because contactless payments depend on NFC, they cannot use offline PIN as a CVM.

Potential problems with EMV contactless payments

Experts advise that merchants and card-issuing banks take steps to educate consumers about contactless EMV payments because they are unlike traditional payment processes. U.S. consumers, who are used to swipe-and-sign or swipe-and-PIN magstripe transactions, may need to be reassured that contactless payments are both possible and secure.

Interested in accepting EMV contactless payments?

Host Merchant Services offers EMV solutions for business owners. If you’re interested in getting a head start on the rest of the U.S. market, contact an HMS sales representative today and ask about our EMV-compliant equipment and processing options.

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