Are you annoyed by the extra time it takes to stick your chip-enabled credit or debit card in a payment terminal, wait for it to process, sign or enter a PIN and then wait for that irritating noise that means you can finally remove your card? If so, you’ll be glad to know that an alternative is on the horizon: the contactless payment card.

If you’ve ever used a mobile payment service like Android Pay, Apple Pay or the now-defunct Blink card from Chase, then you already have a basic understanding of these cards. But if you haven’t, or if you’d like to know more about how they work and how safe they are, read on. (See also Best Mobile Payment Apps for Tap and Pay and How Does Apple Pay Work?)

What Are Contactless Cards?

Contactless cards use radio frequency technology to transmit the cardholder’s account information wirelessly to a point-of-sale terminal. By holding a contactless card just one to two inches away from the terminal, consumers can quickly and easily pay for goods and services.

Contactless card technology has been available in the United States since 2005, but it hasn’t caught on for several reasons. Stores didn’t have the right kind of terminals to accept the cards, and even when they did, some terminal weren’t compatible with some cards. Further, banks and credit card companies haven’t issued enough contactless cards to consumers. Also, the time saved by waving a card over a payment terminal compared with swiping a card through a payment terminal was insignificant, especially when payment networks stopped requiring consumers to sign for transactions below a certain dollar amount.

Will We Be Seeing More of Them?

The popularity of contactless payment cards in the United States could be changing. Public transit systems in Chicago, Philadelphia and New York are using them to make it faster and easier for people to pay their fares, which is helping consumers get familiar with the new technology. The new EMV chip cards have slowed down payment transactions, likely making consumers more open to a faster alternative. And the new machines required to read chip cards can usually read contactless cards, too.

What’ore, the cards have become widely and successfully adopted by merchants and consumers in Australia, Canada and the United Kingdom, providing examples that the United States can follow. By the end of this decade, 55% of all new US credit and debit cards are expected to be contactless, the New York Times reports.

How Safe Are They?

Industry associations like the Smart Card Alliance Payments Council, which promotes the adoption of contactless and chip payment systems, say contactless payment cards are safe, as do the companies that issue them, such as MasterCard and Visa. If you accidentally tap your card twice for the same transaction, you’ll only be charged once, and encryption technology protects your card data during transactions.

The New York Times says these cards are significantly more secure than magnetic strip cards, and card issuers say cardholders are protected against contactless payment fraud in the same way they already are with magnetic strip and EMV cards – just report any fraudulent transactions to the card issuer. Some issuers also identify which transactions were contactless on consumers’ statements, which may help in detecting fraudulent transactions. (See Three Ways to Avoid Electronic Pickpocketing.)

However, several reports have revealed potential security flaws with contactless cards. Anyone with a near field communication (NFC) reader could pass it by the wallet of someone with a contactless card and read its card number and expiration date, according to a report by two U.K. researchers. Consumers might need to take extra steps to prevent this type of data theft, such as buying an NFC-blocking wallet or carrying a small piece of aluminum foil near the cards in a wallet or purse, the New York Times says.

Forbes reported on an Android app that can bypass the technology’s built-in safeguards to clone a contactless card in seconds and use the data to make fraudulent purchases. Another U.K. investigation found that cheap card scanners that anyone can buy online can steal contactless card information and use it to make purchases.

An additional problem that has occurred in the U.K. is that thieves have been able to keep making purchases with stolen contactless card data for several days after the card is canceled because certain transactions are processed offline. While cardholders aren’t responsible for these transactions, it can still be a headache to find and report all of them. Fraudulent transactions can be especially problematic in the case of a debit card, where such transactions could cause an accountholder’s balance to dip lower than expected and result in bounced payments.

But reported fraud levels have been low in the U.K. – less than 4 cents per $100 of transactions – where contactless payment card adoption is high. We might expect similar fraud levels if contactless cards become more popular in the United States.

Contactless Payment Availability

In the United States, contactless payment cards are available from several issuers. American Express makes it available on most of its consumer cards and a few small business cards; you can tell if your card has a contactless chip by looking for the contactless symbol on the back of the card.

MasterCard also issues contactless debit and credit cards. Visa’s contactless technology is called payWave and is available with cards issued by Barclaycard, BB&T, PNC Bank, SunTrust, Wells Fargo and a few other issuers.

Currently, retailers with payment terminals that accept contactless payment cards include Whole Foods, Sports Authority, Anthropologie, ToysRUs, Peet’s Coffee, Jamba Juice, Staples, Subway, Verizon, Texaco and Petco. The technology may not be available at all locations. MasterCard has Google, Apple and Windows apps to help you locate retailers in your area that accept contactless payments.

The Bottom Line

If you’d like to be ahead of the technology curve, save time at the store or just be prepared if your bank or credit card company sends you a card with contactless payment technology, now you know how contactless payment cards work as well as their potential security shortcomings. The best way to protect yourself against those is to always review your monthly statements and perhaps check your transactions online once a week for earlier detection.

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