Thieves and reckless spenders paradise: Contactless limit rises to £100 this week

Laura Suter
12 October 2021

Laura Suter, head of personal finance at AJ Bell, comments: 

“The amount you can spend on contactless cards will more than double this week from £45 to £100. Despite being sold as a way for people to spend more conveniently, the move is a paradise for thieves, who can steal hundreds of pounds from you before you’ve even noticed. 

“Fraud protections aimed at stopping thieves mean that everyone is be required to enter their PIN if there are multiple transactions up to £130. But this is now more than doubling too, to accommodate the new £100 limit, and means that thieves won’t face a request for a PIN until they’ve spent £300. If you have multiple cards in your purse or wallet, the total amount stolen could quickly rack up.

“Bank bosses point to the advance of technology helping to fight fraud, as some allow people to quickly freeze their cards in an app if it’s lost or stolen. This works for younger or digitally-savvy customers, but leaves vulnerable customers, older people and the less digitally savvy out in the cold. 

“For those wary of the new £100 limit, a handful of banks are allowing people to set their own, lower contactless limit. Unfortunately, not many are offering this and the default will be for people to be automatically switched to the higher rate and have to opt-in to a lower limit, meaning many will sleepwalk into a £100 limit without realising it.

“However, people should be reassured that banks will reimburse you for any card fraud, including fraud that happened before you notified the bank of the theft. A total of £7.6m was stolen in contactless fraud in the first half of this year, but lockdown meant fraudsters had less opportunity to steal cards. With a higher contactless limit and lockdown over, these figures will surely leap for the second half of the year.

“A big risk of the higher limit is people unwittingly going into debt or overspend without realising it or being overcharged. The process of a contactless transaction being so quick means that many won’t register how much they are paying before tapping their card. People are likely to rack up larger credit card bills or go overdrawn as a result. For people who know they are prone to overspending or are already in debt, a lower personal limit is essential, and it’s important all banks offer this to customers.”

Which banks allow a lower limit?

For now just four banks allow a personal contactless limit. Halifax, Lloyds and the Bank of Scotland will all let people set their own limit between £30 and £95, but only on debit cards, while Starling Bank will also allow a personal limit to be set between £10 and £90 via its app. 

Some banks, such as Nationwide, NatWest, Barclays, and Santander, will now allow you to opt out of contactless altogether. Some will send new cards, while others will just disable the contactless functionality on your card. However, HSBC, Barclaycard, American Express, Capital One and MBNA all won’t allow a personal limit nor will they turn off contactless.

Laura Suter
Head of Personal Finance

Laura Suter is head of personal finance at AJ Bell. She is a multi-award winning former financial journalist, having specialised in investments. Laura joined AJ Bell from the Daily Telegraph, where she was investment editor. She has previously worked for adviser publications Money Marketing and Money Management, and has worked for an investment publication in New York. She has a degree in Journalism Studies from University of Sheffield.

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