Visa to launch radio frequency credit cards in UAE

The RFID technology allows users to pay without signature, pin number or direct contact with reader. (Getty Images)

Visa is set to launch its own range of contactless credit cards in the UAE by the end of the year on a pilot basis.

The cards, which are already widely used in parts of Europe, the US and Asia, work using RFID (radio frequency identification) technology and allow customers to pay for items in less than a second by passing the card within four centimetres of a reader.

No direct contact is needed between the card and the reader, and no signature or pin number is needed from the customer.

"In the UAE we are now planning a pilot and that is planned to start at the end of the year," said Sameer Govil, area manager for the Middle East at Visa.

"It would take place in the UAE. We can't give more details for that.
"It is with a Visa bank in the market."

Concerns have been raised worldwide regarding the security of contactless credit cards due to the fact that no customer identification verification is needed before payments can be made.

To combat this Visa is introducing a limit on the amount of money that can be spent in any one transaction using the cards, and a limit to the number of transactions that can be done using the cards before customer verification is required.

The cards have a spending limit of 100 dirhams ($27.2) per transaction and a customer can make three transactions before they are asked for a pin number or signature.

"There are limits set up on the cards which say even if you have ‘x' amount of dirhams you could spend in one transaction, you also have a cumulative limit," said Govil.

"The principles are that the limit should be such that it enables banks and customers to do the majority of the transactions at the payment location, so the issuer does not see the details straight away.

"So suffice to say there are risk parameters which banks can control and they differ in each market."

The use of contactless cards only for transactions of around 100 dirhams means that they are best suited for outlets where customers tend to spend small amounts - such as fast food outlets or grocery store.

With this in mind Govil said Visa aims to specifically target these types of locations and to encourage merchants to install readers.

"We do not foresee that all merchants will start deploying contactless card readers because the fact is that it would only be of use in locations where typically the merchants handle low value transactions," he said.

Emirates Bank has already launched a range of contactless MasterCard credit cards in partnership with Dubai Internet City (DIC).

For more information read October's issue of Money magazine.


We would like to point out that an image used earlier alongside this article which featured a PayPass card with a Visa logo was incorrect. PayPass is in fact a MasterCard product. We apologise for this confusion.

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