Contactless credit card: How ‘tap-and-go’ cards work, which U.S. banks issue them


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Dan Rafter

Personal Finance Writer
Specializes in mortgages, credit and credit scores

Contacless credit card guide: How 'tap-and-go' cards work

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Are you ready for contactless credit cards, cards that you can simply tap to a terminal to buy a coffee, doughnut or slice of pizza?

Even if you are ready to ditch the swiping and dipping, the odds are good that your card issuers aren’t ready to send a contactless card to you – yet.

But there are signs that this is changing. Merchants today have the technology to accept contactless cards. And the successful rollout of EMV chip cards has proven that consumers are willing to adapt to new ways to use credit cards.

When will contactless cards become the norm in the United States? A recent study suggests that issuers might start rolling out contactless cards in far greater numbers as soon as 2020.

See related: Contactless cards get crucial boost as Chase embraces tap-and-pay

Contactless credit cards: What you need to know

How contactless cards work

Contactless cards are easy to use.

  • They come embedded with chips and a near-field communication – or NFC – antenna.
  • When consumers are ready to check out, they tap their contactless cards to a point-of-sale terminal.
  • The card communicates with the chip terminal through radio waves.

Contactless cards come with enhanced security, too. The cards generate a unique cryptogram with every transaction, making it more difficult for thieves to steal data.

Mark Ranta, head of digital banking solutions at ACI Worldwide in Naples, Florida, said that contactless cards are all about bettering the customer experience.

“It’s all about the speed of the transaction,” Ranta said. “Literally, it is ‘tap and go’ with contactless cards.”

Today’s EMV cards, in which consumers must dip their cards into a reader, can take up to 30 seconds to close a transaction. Contactless cards can complete the same transaction in 13 to 15 seconds.

Contactless cards marked by slow U.S. adoption rate

Ranta said that the United States actually leapt into contactless card technology early, with Mastercard introducing its Tap & Go contactless card in 2005. Unfortunately, consumers worried that thieves equipped with readers would steal their information.

“We were out in front with this, but then the United States drew back,” Ranta said. “It went back to the ‘swipe and wait’ method.”

Credit card issuers had little incentive to push contactless after this, Ranta said.

In addition to the fears of cybercrime, most merchants didn’t have terminals that could accept contactless payments. Once consumers tried to pay with contactless technology and found that a merchant didn’t accept this type of payment, they had little incentive to try again, Ranta said.

“If you try something once and it doesn’t work, you’re less willing to try it again,” he said.

How the EMV chip transition may benefit contactless cards

This, though, has changed with the recent rollout of EMV chip cards. An ever-growing number of merchants now have terminals that accept contactless payments because the new terminals they needed to accept EMV cards also work with contactless cards.

At the same time, consumers have shown that they can adapt to new ways of using credit cards. They’ve gone from swiping their cards to dipping them. Asking them to consider contactless payments shouldn’t be as much of a hurdle today, Ranta said.

“To ask them to go to tap-and-go doesn’t seem as far-fetched today as it did when you had 30 years of swiping,” he said.

See related: EMV cards’ common errors: A guide for confused cardholders

U.S. issuers that offer contactless credit cards

Many credit card issuers today still do not offer contactless credit cards – but that might be about to change.

American Express

American Express: 

Bank of America

Bank of America: 

  • A representative for Bank of America confirmed that the issuer does not offer contactless cards.

Capital One

Capital One: 



  • Chase announced November 2018 it’s preparing to roll out contactless technology on all newly issued and renewed Chase Visa cards. Popular cards such as the Chase Sapphire Reserve and Chase Freedom will feature the technology by summer 2019. Chase debit cards will also be granted tap-and-go abilities sometime before 2020.





  • A representative for Discover said that this issuer does not currently offer contactless cards.

Wells Fargo

Wells Fargo: 

A contactless-card wave on the way?

Some studies, however, do indicate that contactless cards are on the verge of soaring here.

Consider a 2017 report by management consulting firm A.T. Kearney.

Demand for contactless cards is growing in the U.S.

Jon Wilk, chief executive officer of Somerset, New Jersey-based CompoSecure, a manufacturer of metal credit cards, said that he is already seeing a stronger push in the United States, and internationally, for contactless cards.

Wilk says that about a third of CompoSecure’s business in 2018 consisted of contactless cards. And this year? Wilk says that should rise to more than 50 percent.

Wilk pointed to the shift to EMV chip cards as a reason for this push.

“The consumer experience with EMV cards hasn’t been as pleasant as people would like,” Wilk said. “The transactions at the point of sale are taking a bit longer than some consumers and merchants would like. That spurs new opportunities for contactless payments as a faster, easier alternative than inserting the chip card.”

What will inspire the issuers to send out these cards? Maybe a big event such as the one coming up this year. That’s when New York City’s Metropolitan Transportation Authority will launch contactless payments for transit riders.

Riders starting in the late spring of next year will be able to pass through a gate with either mobile phone payments or tap-and-go contactless credit cards. This might result in more attention to the possibilities and ease of tap-and-go cards, Wilk said.

Why has U.S. contactless card adoption been so slow?

There are several reasons why contactless has been slower to catch on in the United States than in countries like the United Kingdom and Australia.

Matt Boss, head of U.S. partnerships and shared services for TD Bank, spent about four-and-a-half years living in Australia where he saw just how strong a hold contactless cards could have on a country.

“If you want to understand what contactless can become in the United States, there is no better market than Australia,” Boss said. “In Australia, it is possible to live in an almost purely contactless environment. At least that is how I conducted my life. I don’t think I ever carried cash.”

But Australia has a very different banking structure than does the United States. As Boss says, in Australia there are four major banks that control most of the credit card market. There are also very few big players controlling everything from airlines to supermarkets.

That’s different from the United States, which has far more major players in every industry.

“The adoption will be slower here, but as consumers start to experience it, they’ll see that it’s a more pleasurable way of paying,” Boss said. “The adoption will then ramp up more as these payments become more commonplace.”

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