In order to make shopping more convenient and to speed up customer service, the payment limit for contactless payment card transactions that do not require a PIN code to be entered has been raised from 10 Euro to 25 Euro. Over the course of the next few weeks, all retailers whose equipment accepts contactless payment cards will gradually adapt to the new payment limit.
“Banking sector statistics show that people are using contactless payment cards more and more. In 2017 the average contactless payment sum doubled compared with the same point in 2016. At the same time, we see that the average card payment in Latvia is over 10 Euro. By raising the limit to 25 Euro, clients will be able to take advantage of the appeal of contactless payments more often and pay for their everyday purchases more quickly. It has been calculated that contactless payments are three times as fast as paying with cash, and twice as fast as entering a PIN code,” says Sanda Liepiņa, Head of the Association of Latvian Commercial Banks (ALCB).
“By raising the contactless payment limit to 25 Euro, it will fall in line with the European average. Contactless cards are popular in Central and Western Europe, where the average contactless payment limit is up to 20 Euro,” adds the ALCB head.
In Latvia, payment cards with contactless payment options have already been available for five years. Currently, Latvian residents use around 474,000 cards with contactless technology daily, and card terminals with contactless technology number 20,000. Payments with contactless cards can be made in over 14,000 places in Latvia and at 6.5 million retailers worldwide.
“Over the past few years, Citadele has actively installed new contactless card terminals in Latvia in order to create a suitable infrastructure within the country for contactless payments. Currently around 80% of Citadele card terminals support contactless payments, and we are actively continuing the replacement of terminals so that, soon, all payment locations served by Citadele will offer the opportunity to pay by contactless card. The amount of contactless terminals in Latvia is now large enough for it to be advantageous for residents to make these payments a habit. We predict that clients will use the opportunity more and more often to pay quickly for small purchases - without inserting a bank card into the terminal and entering their PIN. Contactless cards can be used, for example, in Maxima and Rimi shops, several pharmacy chains, various cafes and with retailers across Riga and outside of Riga,” says ALCB Payment Card Subcommittee Representative and Head of Citadele Bank’s Card and Payments Department Andris Lazdiņš.
Representative of the ALCB Digital Transformation Committee and Citadele Bank Head of E-business Mārtiņš Bērziņš adds that, last September, Citadele was the first in the Baltics to start offering their clients the option of paying using other contactless payment methods - Android mobile phones, special bracelets and stickers. “To pay by smartphone, it must be held close to the terminal just like a contactless card - payment for the purchase happens when payment confirmation appears on the screen. These payments are popular in places where purchase speed is important to people - Rimi, Circle K, Maxima. Citadele Bank has also provided contactless payments in Riga public transport since 2015, with an e-talons function built into its bank cards. In many countries worldwide, mobile payments have become everyday occurrences. It is predicted that in 2020 38% of card payments in Europe will be made digitally, for example, via smartphone or other devices,” says Mārtiņš Bērziņš.
The requirements of international card organisations VISA and Mastercard state that, by 2020, all payment card terminals in Europe must accept payment cards with contactless technology.
Contactless payments and retailers
474,000 Number of cards with contactless technology
20,000 Card terminals with contactless technology
14,000 Retailers in Latvia
6,500,000 Retailers worldwide
Source: ALCB, December 2017