Stolen Contactless Cards can still be used even if Cancelled

The majority of debit cards and some credit cards have a contactless facility these days . This means that anyone in posession of the card can use it to pay for goods up to the value of €30 without a PIN. (More about Contactless Cards here).

If you lose your debit card,  or it is stolen – the first thing you should do is to let your bank know and get them to cancel the card. Once a card is cancelled , you would assume that no more transactions could be carried out using that card …… well you would be wrong !

It seems that on some cards contactless transactions could still be carried out even after cancellation of the card. According to reports in the Guardian and MoneySavingExpert – there have been examples sometimes even months after a card was cancelled. The problem arises because many payments are processed  offline and checked and debited later.
Some, but not all, card issuers have systems which identify and block cancelled card transactions before they are debited from customer accounts.

The good news is that any fraudulent transactions will be refunded by the bank /
But – the bad news is that ,  if you lose a debit card or it is stolen – the only way to be certain you haven’t been a victim of fraud is to trawl through months of  statements looking for suspicious low-level transactions . Some fraud must be going undetected because people who have cancelled their cards wrongly assume they can no longer be used.

Last  year – the chief executive of the  UK Financial Conduct Authority said ….
“We are aware that, in limited circumstances, it is possible for a cancelled contactless card to be used by fraudsters. While there are controls in place and the overall risk is low, we have been urgently working with card schemes and banks to ensure this issue is fixed.”