U.S. Bank Launches Contactless Credit Card Pilot
U.S. Bank announced on Monday that it will begin testing “contactless” credit card payments with a limited number of customers in the Denver, Colorado area. Customers in the pilot program are receiving their cards this month. U.S. Bank says there are over 600 locations in the Denver area that accept contactless payments, which use radio frequency technology to allow consumers to pass their credit cards next to a card reader without swiping them in a machine or giving them to a retailer to swipe.
Visa and MasterCard have rolled out so-called contactless cards with various issuers, including Chase, Citi, HSBC, Wells Fargo and Advanta. American Express also offers cards with radio frequency identification (RFID) technology. In order for the credit cards to be used in a contactless manner, merchants must have the proper card readers installed at their locations. If they don’t, the cards can still be used in the traditional way to make purchases.
Some consumer advocates have been critical of the RFID technology, saying it makes identity theft a greater possibility. A recent, widely-publicized experiment at the University of Massachusetts showed that a makeshift card reader that could read cards without encryption could be built fairly cheaply. At least one card company spokesperson said it was a flawed experiment that wouldn’t be feasible in the real world.
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