interactive investor comments as the spending limit more than doubles.
Commenting, Myron Jobson, Personal Finance Campaigner, interactive investor, says: “The contactless spending limit has more than doubled to £100 a time as of today – but it may be a while before the new limit is broadly accepted among retailers as many terminals need to be updated.
“Contactless payments are easy and frictionless. The worry is the new bumper limit could encourage reckless spending, resulting in some customers spending beyond their means which could lead to debt issues at a time when many are feeling the financial pinch owning to the pandemic and rising cost of living.
“The new limit could particularly prove to be a slippery slope for some holders of contactless enabled credit cards that typically allow users to slip into overdraft without having their payment rejected. This is exacerbated by the fact that many have gotten into the habit of not taking a receipt – especially after using self-service checkouts – so it is harder to keep track of spending.
“If you are worried about overspending, it is worth considering withdrawing cash ahead of a shopping trip to ensure that you stick to your budget. It is also worth asking your bank for a card without contactless technology. Many banking institutions issue contactless cards as standard, but some allow customers to switch to a non-contactless alternative on request. The additional seconds spent viewing the total when entering a PIN could be crucial for people with a tendency of overshooting their budget via ‘tap and go’.
“Upping the limit to £100 could exacerbate the problem of pickpockets or malicious individuals using lost bank cards to make as many transactions as possible before the account is blocked. Consumers might feel more comfortable with making contactless payments through mobile wallets like Apple Pay than using a contactless card given the higher limits and greater security - purchases are authenticated each time such as using a fingerprint – they afford.”
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