1 - WHAT ARE THE CURRENT LIMITS TO THE USE OF CONTACTLESS?

The European Banking Authority has defined the following rules to regulate contactless payments in the European Union:

There is no limit for making a contactless payment. Nevertheless, in some conditions, the implementation of a strong authentication (PIN code for example) is required. This is particularly the case when you make more than 5 contactless transactions in a row, you will be asked to enter the PIN code even for an amount lower than 50€.

If you pay with your phone, the strong authentication is done by your fingerprint. This means that all payments made with your phone can be accepted by a payment terminal without the need to insert your card and enter your PIN code. 

On the other hand, when you use your card to pay "contactless", you are never asked for your PIN code. This entry is only possible when you insert your card in a payment terminal. You are then asked to enter the PIN code. The terminal checks the PIN code against the encrypted information on the inserted card. This method of verification is called "PIN Offline" because the verification is done directly by the terminal.

But an evolution on the French market is underway! Soon you will be able to enter your PIN code after swiping your card in "contactless" mode. The terminal will verify the PIN code directly with your bank's server. You will no longer have to insert your card into the terminal. This verification method is called "PIN Online".

2 - PILOTS ARE UNDERWAY

Some merchants have started to try this new feature. For example, the Taxi G7 group is offering this feature to their merchants. 

Market Pay also offers this solution with PayWish®, notably used at MATY. Customers are asked to enter their PIN code after a contactless payment exceeding €50.

3 - WHEN CAN WE EXPECT TO BENEFIT FROM IT?

To implement this small revolution, all the players in the payment chain must be ready:

For this, a schedule has been imposed in France for all players to be ready by the end of 2022. The goal is for the functionality to be available everywhere by the end of 2024.

Until then, if you want to know more about PIN Online, you can watch our episode of Instant Payment dedicated to this topic.