Lloyds TSB launches contactless payment push

Lloyds TSB has today announced plans to push contactless payment cards to the majority of its customers, starting with those located within the confines of the M25.

The company's plans echo those of contactless payment pioneer Barclaycard, offering holders of Visa debit cards the chance to make payments of up to £15 simply by waving their wallets vaguely in the direction of a compatible point of sale system.

"Contactless VISA debit cards provide an efficient alternative for customers making small purchases," claimed the bank's head of current account products Philip Robinson. "With the increasing trend towards debit card usage over cash, contactless debit cards provide customers with convenient payment options."

There's certainly no denying that contactless payments are convenient: with the system working on a proximity basis, there's no need to remove your card from a thin wallet - and there's no need to enter a PIN, either.

If you're reading the above and wondering about the security, you're not alone. While Lloyds TSB claims that the system offers the 'same high level secure technology' as Chip and PIN, the fact that no PIN entry is required suggests otherwise. While the £15 individual payment limit is useful, the technology raises the spectre of potential fraud from reader-equipped ne'er-do-wells.

"Lloyds TSB will continue to provide the same assurances in the event of any fraudulent use as with Chip and PIN payments," the company asserted in a statement. Sadly, this is likely to prove cold comfort to those who have reported fraudulent Chip and PIN transactions, where the customer is traditionally blamed for divulging the PIN and must prove their innocence before monies are refunded.

The cards will be automatically issued to all current account customers - aside from those on the company's 'Control Account' product - located within the confines of the M25 the next time their card comes up for renewal.

The bank provides an opt-out mechanism for those would would prefer to stick with Chip and PIN - or even the lesser-known Chip and Signature - while those outside the M25 can request inclusion in the programme should they so desire.