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May 28, 2020

Visa, Mastercard urge Indian central bank to increase limits on contactless payments

Visa and Mastercard, along with the Payments Council of India (PCI), have asked the Reserve Bank of India (RBI) to increase the contactless debit and credit card payments limits.

The payment giants urged the RBI to increase the contactless payment limit from INR2,000 ($26.40) to INR5,000 ($66), the ET has reported.

They believe that relaxing the limits on ‘tap and go’ payments could make card purchases safer for consumers and the merchants after Covid-19 ends.

The contactless cards use Near Field Communication (NFC) technology to enable customers to make transactions at payment terminals without swiping the cards.

The shoppers and retailers using contactless cards can make purchases without physically touching the payment terminals and swipe machines to type a PIN.

This ultimately removes the risk of person-to-person virus transmissions or other infections going forward.

ET quoted a person aware of the development as saying: “The players had argued that a relaxed limit could see increased adoption of contactless payments as they have been established as a safer way to make card payments.

“Other alternatives were also suggested such as tinkering with the limit to INR3000 ($40) or a temporary relaxation for six months.”

Presently, customers need not enter a PIN for contactless transactions below INR2000 ($26.40).

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