Contactless Payments: Tips to Protect Yourself from Fraud

Research from Sumsub, based on 4.3 million verification procedures conducted in the country, highlights that the most vulnerable industries include payments, investments, trading, gambling, and cryptocurrency.

One of the key findings is that 88% of forged IDs in Brazil are printouts, likely due to regional inconsistencies in the country’s identification documents, making it easier for fraudsters to create forgeries.

As contactless payments become more prevalent in Brazil, now accounting for one in every four purchases, security concerns are growing. By mid-2022, it was projected that half of all transactions in Brazil would be contactless.

Despite this widespread adoption, many users remain uncertain about how to safeguard themselves against fraud when making contactless payments.

Below are some essential tips to protect yourself from scams.

Understanding Payment Fraud

Payment fraud occurs when someone uses false or stolen payment information to make unauthorized transactions. This can be biggest problems when talking about personal data also. 

This can involve stolen credit card data, fake checks, or unapproved electronic fund transfers.

Retail businesses, handling high volumes of transactions, are particularly vulnerable and can suffer significant financial losses, reputational damage, and legal consequences due to payment fraud.

Common Tactics Used in Payment Fraud

Fraudsters employ a range of techniques to steal payment information or execute unauthorized transactions. Here are the most common:

• Phishing: Fraudsters create fake websites or emails to trick people into revealing sensitive information like credit card numbers or login credentials.
• Skimming: A device is discreetly attached to a payment terminal, stealing credit or debit card details during legitimate transactions. This data can then be used to create counterfeit cards or withdraw cash.
• Identity Theft: This involves fraudsters stealing personal information, such as names, addresses, and Social Security numbers, to open new credit accounts or make unauthorized purchases.
• Chargeback Fraud: A customer disputes a legitimate purchase with their bank, claiming it was unauthorized, leaving the business to reimburse the customer despite the purchase being valid.
• Business Email Compromise (BEC): Fraudsters impersonate senior executives or business partners through phishing emails to trick employees into sharing sensitive information or transferring funds.
• Malware: Malicious software is used to gain unauthorized access to a victim’s device, enabling fraudsters to steal sensitive data like credit card details and passwords.

How to Protect Yourself from Contactless Payment Scams

Always Verify the Payment Amount

One common scam involves manipulating the payment terminal to show an incorrect amount.

Sometimes, the display is broken, or the light is intentionally dimmed, tricking the payer into completing the transaction without verifying the amount.

Always double-check the transaction amount before tapping your card.

Monitor Your Bank Statements Regularly

Stay vigilant by reviewing your bank statements regularly. Enable notifications in your bank’s app to receive alerts about all transactions.

This will help you identify any unauthorized activity promptly, which is critical in minimizing potential financial losses.

Keep Your Card at a Safe Distance Until Payment

Contactless payments can be made within a range of up to 4 cm from the terminal.

To avoid unintentional payments, keep your card away from the terminal until you’re ready to complete the transaction and have verified the amount.

Is Contactless Payment Safe?

Yes, contactless payments are just as secure as traditional card transactions or online purchases.

They include multiple layers of protection, and for purchases under R$200, no PIN is required—though this is limited to five transactions per day.

Card companies also use advanced fraud detection systems, including artificial intelligence, to identify and prevent suspicious activities before they happen.