How does a PayWave or Tap and Go card work?

Visa and Mastercard credit and debit cards with contactless payment technology, called PayWave, PayPass or Tap and Go let shoppers pay for goods and services without a PIN or signature by holding their cards hear a contactless reader.

A National Australia Bank-issued MasterCard then generates one of 99 "unpredictable numbers" to support authorisation.

MasterCard said a payment also needs static data like the cardholder name, card number and expiry date.

Both Visa and MasterCard said they have a strong security framework and sophisticated monitoring systems associated with contactless payment cards, and also stressed their zero liability policies as a further important consumer protection.

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