ALARMING INCREASE IN CONTACTLESS PAYMENT FRAUD

Criminals are increasingly cashing in on the growing popularity of tap-to-pay contactless payments in South Africa.

Along with the convenience of tapping one’s bank card, using your smartphone or smartwatch at a point-of-sale (POS) machine, comes the risk of fraud.

An alarming increase in digital payment fraud has been reported as scheming scammers target unsuspecting victims at the service stations and till points.

“Imagine you’re paying for petrol and someone is standing near you,” said Richard Frost, product head from cyber security company Armata, told BusinessTech.

“They’re talking on their phone; it’s completely normal. Nothing to worry about, right? Well, until you tap the point-of-sale device with your card, that is.

“As you tap, that criminal uses another credit card machine to track your card, and the money comes off twice — once for the petrol and once from the fraudster,” explained Frost.

“It’s an incredibly easy scam to perpetrate as well. All you need is a credit card machine in your pocket and you can take any amount you want from someone’s card when they use the tap-topay function.”

By the time the consumer gets the two notifications from their bank, the fraudster would have already vanished into thin air.

“You can spend quite a lot of money in one tap, which means that the skimming devices designed to siphon the funds at the moment of payment can really hit people hard,” said Frost.

According to him, the best way to protect your hard-earned savings is to disable your bank card’s tap function or to insert it into a card machine and use your PIN.

Frost added that another option is to rather use your cellphone with a virtual card or one of the digital wallet payment services. Apart from the time limit on phone payments, cellphones have more security.

According to the Ombudsman for Banking Services South Africa (Obssa), this scam works by exploiting near-field communication (NFC) technology and tap-and-go payment systems.