Keep the card. Ditch the contact.

The next big thing in wave-and-pay is here, and credit union adoption is surging as major issuers deploy the NFC plastic.

Following the path forged by EMV chip cards before them, contactless plastic is expected to ride a major wave of adoption this year and next.

In fact, they’ll be on the same card. The wave-and-pay functionality of contactless cards resides in a chip embedded in tandem with the EMV chip that is now so ubiquitous that Visa says 96% of its point-of-sale volume is made using those cards.

The contactless function — also known as contactless EMV — requires a new type of plastic, a dual-interface card that accommodates contact and contactless technology. They have an RFID chip that communicates with the payments terminal through the Near Field Communication (NFC) protocols, the same technology that powers wave-and-pay mobile wallets. That process creates a single-use code, called a token, that allows the transaction to proceed securely.

The same process occurs on the contact side of the interface, when the EMV chip creates a code when it’s inserted, or dipped, into the reader. Traditional magnetic swipe stripe functionality also is retained on this plastic.


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