Contactless payment thresholds increased, FCA confirms
The thresholds for contactless transactions have been increased following an ongoing increase in use from both businesses and consumers, confirms the Financial Conduct Authority.
The single transaction contactless payment threshold has gone up from £45 to £100, and £130 to £300 for multiple transactions.
The changes will allow the industry to increase the limit for contactless payments at the point of sale to securely improve convenience for consumers and merchants, according to the FCA, and could see more consumers using contactless card payments for higher value transactions such as purchasing fuel and weekly groceries without needing to use Chip and PIN.
In response to this changing behaviour and the coronavirus (COVID-19) pandemic, the industry had already increased the contactless limit from £30 to £45 in April 2020.
To support consumers and merchants during coronavirus, the FCA confirmed that they were very unlikely to take enforcement action where a firm fails to require Chip and PIN when a customer exceeds the cumulative transaction value threshold.
The FCA said that as a result of the new changes, this flexibility is no longer needed, meaning firms will be required to comply with the new thresholds and that the FCA may take appropriate measures, including enforcement action, where breaches of the limits set in new rules are identified.
FCA executive director for consumers and competition Sheldon Mills said the authority is changing its rules to help the industry continue to respond to the changing ways in which people prefer to pay.
“Increasing the regulatory limits allows industry to raise the contactless limit in the future to meet the evolving expectations of customers and merchants for fast but secure ways to pay,” Mr Mills said.
“When making any change, it is important that the industry continues to ensure the right protections are in place to keep payments safe and secure.
“We encourage the industry to use these changes to support consumers and merchants during the recovery from the coronavirus pandemic.”