Emma RadmoreInnovate Finance has responded to the FCA call for input on contactless limits. It queries whether the proposals really do align with economic growth objectives. It cites the crucial need for regulatory focus on SCA and FSCS parity for EMIs, and says that where the FCA is proposing to remove what it would call “unnecessary regulation” to “aid economic ambition”, it is critical to consider the growth impact against potential consumer detriment.
While Innovate Finance can appreciate that an increase in the limit to keep pace with inflation might be appropriate, it has not seen evidence of general high demand for higher limits, and says the focus should align with the National Payments Vision and allow individuals, not their PSPs to set limits appropriate for them and perhaps consider only PINs and other developments. It does also support a review of the currently probably too rigid rule for step-up authorisation after a certain number or value of transactions, as this could better avoid unnecessary friction when consumer make a series of small everyday purchases. And it supports retaining the exemption for payments on, for example, unattended transport terminals.
Finally, although it acknowledges that contactless fraud is not growing as fast as transaction volumes, the absolute figures are still concerning.