Potential contactless card changes could give abusers green light, charity fears

Concerns that higher contactless card limits could unwittingly “give a green light” to domestic abusers to drain victims’ bank accounts have been raised by a charity.

The contactless card limit for a single payment currently stands at £100 – but the Financial Conduct Authority (FCA) has said it wants to give card providers the flexibility to decide the right limit for them and their customers.

It is consulting on changes that could see limits exceed £100.

However, the regulator also said that, based on industry feedback, it anticipates that most firms would continue to implement the £100 limit for the time being.

Sam Smethers, chief executive of Surviving Economic Abuse, argued that abusers could end up with “free access to drain a survivor’s bank account”.

She said: “This could leave a survivor without the money they need to flee and reach safety, while pushing them even further into debt.

“This move highlights the urgent need for financial services to adopt a consistent, industry-wide approach to coerced debt – one that reflects and recognises victim-survivors’ experiences. Survivors should not be left to pay the cost of an abuser’s crime.

“Raising contactless limits also marks another step towards a cashless society. For survivors, cash is not just a means of payment – it’s a lifeline.

“Abusers can monitor online transactions, withhold bank cards and close down bank accounts, whereas cash could be a survivor’s only way of escaping harm or even putting food on the table.”

The regulator’s proposals are out for consultation until October 15.

A spokesperson for finance and banking industry body UK Finance said: “We recognise the serious and lasting impact of economic abuse and are committed to supporting victim-survivors through tailored help and specialist teams.

“While the FCA’s proposal gives firms greater flexibility, we do not expect any immediate changes to the current £100 contactless limit. Any adjustments are more likely to affect background settings, such as how often a Pin is required, not the removal of limits altogether.

“The industry remains focused on protecting all customers and will continue to hold robust fraud controls in place to detect and respond to unusual activity.

“While contactless payments offer a convenient and flexible way to pay, they do not replace cash, which continues to be available and supported by the industry across the UK.”

A spokesperson for the FCA said: “Domestic financial abuse has a huge impact on the lives of those who experience it, and we work closely with organisations like SEA (Surviving Economic Abuse) to better understand and respond to the experiences of victim-survivors. We welcome and will consider all views in response to our consultation.

“We have set high standards of consumer protection via our Consumer Duty, and we expect firms to be alert to the possibility of coercion and financial control to reduce foreseeable harm to their customers.”

Under the regulator’s proposals, banks and other payment service providers would only be permitted to allow contactless payments where they have identified a transaction to carry a low risk of fraud.

Individual circumstances of victim-survivors will vary and some banks, such as Lloyds, already allow people to set their own contactless payment limits below £100.

Flexibility by firms allowing people to set individual personal limits on contactless payment functionality, including the ability not to allow contactless functionality, could potentially be helpful for some people.

If a bank or payment service provider decided to change its contactless limits, they would need to take reasonable steps to ensure their customers understand any changes.

The FCA’s work on vulnerability has identified areas of good practice by firms, such as the use of artificial intelligence (AI) to help spot indicators of vulnerability and take action.