If you believe the pundits, mobile phones and cards could make all those notes in your wallet obsolete within a few years.
Around half of the developed world has made a mobile payment of some sort in the last 12 months, research suggests. To put that into perspective, more people made a mobile payment in 2011 than wrote a cheque in developed economies including Australia, the UK and US.
Australia’s payments landscape has shifted dramatically in the past few years, as the use of cheques has collapsed and debit cards are becoming more widely used than credit cards. Part of the shift stemmed from previous Reserve Bank reforms, including a cap on the fees Visa and MasterCard could charge businesses for offering their services.
Retail non-cash payments made up only 2 percent of total payments by value in Australia, although overwhelmingly the most by number.
Damian Smith, chief executive of RateCity said retailers are embracing the technology and the supermarket giants are gearing up for a full-scale launch of “tap-and-go” payments systems.
“Very few of us will need to carry a lot of cash within the decade,” he said.
It’s a fast, new, high-tech way to shop; just “tap and go” with your plastic. But as consumers and retailers get on board, there are security concerns.
Security consultant Peter Wesley, from Hacklabs, said this type of technology is the new frontier for electronic pick-pockets.
Using an electronic card reader, which can be sourced by thieves for as little as $100, “they can get your card number and the expiry date,” he told A Current Affair.
The weak point of the card, according to Wesley, is a small chip which emits a wireless signal. But a bigger concern for some is the lack of signature or PIN required for purchases under $100.
“Because there’s no need to check a signature or ID, if someone’s got hold of your card they can use it a lot quicker. I myself suffered from a stolen wallet recently,” said RateCity’s Smith.
The costs racked up on his card by the thief were covered by the bank and that’s a policy that covers all consumers.
MasterCard’s Andrew Cartwright says consumers should have confidence in tap-and-go technology.
“They are protected from all unauthorised transactions,” he said.
“In terms of the technology that Australians have in their wallets it’s a high level of security.”
But whether we like it or not, tap and go isn’t going anywhere; it’s a giant leap towards a cashless society.
Of more than 220 credit cards in the RateCity database, around 60 percent are equipped with the technology, said Smith.
“Don’t run away from the technology, it’s ultimately safe and it should ultimately help convenience and drive down costs. But be sensible about it and always keep an eye on your spending.”