Contactless technology offers many benefits, including faster and easier transactions, versatility to be incorporated into various personal devices including mobile phones, and improved data security over the magnetic stripe technology.

According to the Smart Card Alliance, “Contactless smart card technology includes strong security features optimized for applications involving payment and identities. Every day tens of millions of people around the world safely use contactless technology in their passports, identity cards and transit fare cards for secure, fast and convenient transactions. Multiple layers of security protect these transactions, making them safe for consumers and merchants. Some of these features are in the contactless smart card chip and some are in the same networks that protect traditional credit and debit card transactions.”

Nicely put.

Contactless technology improves data security in several potential scenarios.

ATM skimming: It’s difficult to skim a card that doesn’t actually come into physical contact with the reader. With the old magnetic striped cards, a card must be physically swiped through a reader device. These point-of-sale readers are found in retail environments, gas stations, and on ATMs. Countless skimming devices installed by criminals have been found in all of these environments.

Data breaches: In recent years, there have been hundreds of data breaches resulting in the loss or theft of more than a half billion records. Companies whose databases have been compromised have spent or lost millions of dollars as a result of these breaches. Contactless payment methods incorporating chip and PIN technology encrypt data to prevent it from being read in plain text.

Lost cards: If your wallet is stolen or you lose a credit card, it is highly probable that a thief will take advantage of the opportunity to rack up charges on your magnetic stripe credit card. A contactless chip and PIN card, on the other hand, can’t be used by just anyone, since any transaction requires a PIN.

So there you have it. These are just a few of the security benefits offered by contactless technology.

Robert Siciliano, personal security expert contributor to Just Ask Gemalto. Disclosures