Contactless Transaction

contactless payment is a wireless financial transaction in which the customer makes a purchase by moving a security token in close proximity to the vendor's point of sale (POS) reader. Popular security tokens for contactless payment include chip-enabled bank cards and smartphone digital wallet apps.

Contactless payments can also be referred to as touch-free, tap-and-go or proximity payments. When goods or services are purchased through a contactless payment, the process can then be referred to as a frictionless checkout.

Contactless payments are known for being secure because the customer does not share billing or payment information directly with the vendor. Instead, all communication is encrypted, and each purchase is tokenized with a one-time transaction number. Should a wireless transmission be intercepted, the only information the attacker will get is the one-time code that was used to identify a particular transaction.