TapandPay

Tap and pay refers to contactless payment methods that enable a purchase to be completed by tapping a payment instrument near a compatible point-of-sale reader. The instrument can be a physical contactless card, a mobile wallet, or another NFC-enabled device such as a smartwatch. Transactions are designed to be quick and often occur at retailers, transit systems, and vending machines that support contactless payments.

How it works: The payment terminal activates an NFC reader and communicates with the card or device when it is tapped. The device transmits payment data, typically using tokenization so the merchant never receives the actual card number. A dynamic cryptogram or one-time code authorizes the transaction, and higher-value purchases may require additional verification such as a PIN or biometric check.

Technologies and standards: Tap and pay relies on near-field communication (NFC) and follows EMVCo specifications for contactless payments. Tokenization replaces card details with a secure token, and digital wallets generate these tokens to protect the underlying account information.

Security and limitations: The system emphasizes security through encryption, tokenization, and device authentication. Risks are reduced compared with full card data, but losses or theft of a device or card can still pose challenges, mitigated by remote wipe, device locking, and verification requirements. Some merchants or regions may have spending limits or require additional verification for certain transactions, and not all merchants or wallets are universally compatible.

Usage and impact: Tap and pay has become common in retail, public transit, and unattended kiosks, offering speed and convenience while reducing cash handling. Ongoing adoption is expanding across new form factors and broader acceptance of open standards.