Home / Case Studies / Barclaycard contactless sticks it to you

Barclaycard contactless sticks it to you

I feel like I spend a lot of time these days dissing contactless payments, or at least those that rely on NFC and RFID chip technologies.

The reason being that I cannot see why I would want to get something out of my pocket to touch on a terminal – these are actually contact payments, not contactless – when I could walk into a store and just say put it  on my tab using Square Card Case, or as it’s now called Pay by Square.

Pay by Square is just an app on the phone that, once set up, allows the user to walk into any accepting merchant and just say “it’s on Chris’s Square account”.

No touch and go, just say and go.

I like it.

There are other proximity payments around, such as QR codes as I’ve blogged before, so contactless using NFC and RFID may be a short-lived solution.

That doesn’t mean that heavyweight backing in the UK from Barclaycard and Visa is going to dampen the process, as both are promoting contactless big time.

I’ve already mentioned Visa’s work around the Olympics and what they believe are impressive stats.

As of March 2012, Visa claim that the UK has 20 million contactless cards issued by seven providers, with over 100,000 terminals deployed.

That makes the UK a high proportion of the 31 million cards so far issued across 15 European Union countries – forecast to rise to 80 million by 2015 – and is really down to Barclaycard’s early commitment to getting contactless on the road.

As mentioned the other day, Barclays Bank are trailblazing a first mover lead trail in many areas, and particularly in mobile and mobile contactless, so when they invited me to an ‘exciting announcement about mobile technologies’ I could not resist to find out what it was.

The event opened with David Chan who runs Barclaycard’s consumer services for Europe talking about the four evolutions of cards from the old zip-zap machines which carbon copied the embossed raised numbers from the card in the 1970s (and still used by some today!), through mag stripe, EMV chip and now contactless.

He referenced the fact that big stores like Tesco, Asda, Boots and WHSmith were now joining the contactless revolution along with early movers like Starbucks and MacDonalds.

Interestingly, London’s tube and buses will take contactless payments, not just Oyster payments, via their contactless terminals by the end of next year, and this year will see a 50% increase in the number of pay points accepting contactless.

This is why Barclaycard predict the UK will move from £20 million of contactless payments in 2011 to £6 billion by 2016!

The constraint however is that it is card-based and not as easy to use as a mobile.

With most folks more likely to have their mobile than their wallet, the big announcement was therefore the launch of the Barclaycard PayTag.

Effectively, it’s just a contactless sticker to put on the back of your mobile but, with great fanfare, Barclaycard launched some videos and other stuff for its launch …

They then had the various hacks and journo’s try out the stickers on fake mobile phones to show how easy it was to buy their free lunch using the contactless tags.


I was amused when one of the journo's turned to me and said: "what?  I came all the way here just for the launch of a sticker?"


There’s a whole load of other stuff about the launch I could add here (press release etc copied at the end of this blog), but I still have reservations about contactless, mostly because it is five years since the UK started this process and we’re still a long way from critical mass and partly because other technologies are taking over already.

First, the UK’s slow progress is due to a lack of cohesive rollout as demonstrated by the counterpoint example of Poland.

Poland is Europe’s leading market for contactless payments, with over 54,000 terminals and 5.7 million Visa contactless cards deployed as of March 2012. 

All of the acquirers and key merchants were on board from the start and, between December 2010 and December 2011:

  • The number of cards in use increased five-fold;
  • The number of contactless transactions increased forty-fold;
  • The value of transactions increased by a factor of 43.1 times; and
  • Poland’s use of contactless payments has overtaken the UK’s usage in just one year.


  • Because the issuance of contactless cards in Poland was coordinated across the industry (the UK was uncoordinated);
  • The rollout was national, whereas the UK had a partial rollout;
  • Poland’s program focused upon Tier 1 merchants first, rather than Tier 2 in the UK;
  • Transaction limits were appropriate for the Polish markets, whereas the UK’s limit was too low at the start;
  • The commercial framework was based upon the payment value for each transaction in Poland, rather than the UK program which used the same interchange structures as higher value payments; and
  • The technologies for the POS systems in Poland were proven and reliable, rather than a pilot terminal that was unproven in the UK at launch.

All in all, by entering into contactless later rather than sooner, the Polish deployment has seen far more success than the UK.

Obviously the UK can catch up and the release of the PayTag sticker will definitely help but, even if there were a cohesive execution of contactless in the UK today with Visa and Barclaycard leading, I would still have reservations.

Sure, Barclaycard need to make it work as they have invested heavily, as has Visa, so both firms tell me that they wholeheartedly expect contactless to work alongside cards, mobile, proximity and other  payment methods for the foreseeable future.

I don’t.

As soon as I can say and go, then I’ll give up with touch and go.

The only thing is that the say and go might take another few months or years to rollout.

Meantime, the touch and go folks will have their day.

Anyways, here’s the edited press release from the Barclaycard gig for those who like such things:

19th April 2012, London: Barclaycard today announced the launch of Barclaycard PayTag, a new way to pay with your mobile phone. Millions of Barclaycard customers will be offered the chance to make payments with any mobile phone by simply sticking a Barclaycard PayTag to the back of their handset.

Available at no cost, and exclusively to Barclaycard Visa cardholders, Barclaycard PayTag is an extension of a customer’s credit card account. At a third of the size of a normal card, it can be discreetly and simply stuck to the back of any mobile phone. Once attached, it can be used to make payments of £15 and under, rising to £20 in June, by simply being held over a contactless payment terminal.

56% of UK consumers said that the item they are most lost without is their mobile, according to a YouGov poll of 2,085 UK consumers between 5 -10 April 2012, and so Barclaycard are giving people the option of using the phone to make easy, convenient, everyday payments without the need to upgrade their current handset.

The announcement comes as Visa predicts that the number of contactless point-of-sale terminals in the UK will rise by 50% to 150,000 this year. Major retailers that offer, or are introducing, contactless include Waitrose, McDonalds, Boots, WH Smith and Tesco. By the end of 2012, London buses will also accept contactless payments, followed by the Tube and the rest of the transport network in the Capital in 2013.

Barclaycard PayTag is safe and secure, and comes with the same 100% fraud protection as any Barclaycard. An exclusive group of customers will be invited to receive their Barclaycard PayTag in the coming weeks, before they are offered to millions of Barclaycard customers later in the year.

Research carried out on Barclaycard’s behalf predicts that £3 billion worth of purchases will be made with mobile phones in the UK in 2016 ( 2012 Ernst and Young research).  Barclaycard PayTag provides customers with the choice of simple mobile phone payments now, without having to wait to upgrade, and at no additional cost.



Visa note that there 31 million contactless cards in use with 227,000 terminals from 51 acquirers and 60 issuers in 15 European Union countries today, representing a six fold increase in transaction volumes during 2011



About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

Check Also

Most companies are unprepared for a cyberattack

I was looking around at what’s new online, and just discovered the Hiscox 2018 Cyber …

  • We’re working with the people who ‘did’ Poland to launch a prepaid in Wigan to deliver personalisation service (cooperative member based) that links and individual’s contribution to community with their entitlement.
    think of it as a unified entitlements card that delivers personalised pricing.
    Working with Nesta to scale it up. I know you know David Birch etc let me know if you’re interested in learning more 😉

  • In general I think the success of Oyster, the Polish experience you describe and so on suggest that touch and pay is an acceptable model for many – generally more convenient than fetching cash from your pocket. However I have encountered a problem, in that it seems these things can interfere with each other. My Oyster had worked fine then Barclays sent me a contactless card and suddenly my Oyster had a problem about 3 times out of 4 when I touched my wallet on the reader. The only way round it was to take one or other card out of the way. I tried another Oyster we had in the family but the problem persisted. If this is an inherent problem it raises the question of whether once we have more than one NFC card in the wallet is juggling cards much more convenient than juggling cash ?

  • Richard

    It’s good, but you still have to get your mobile out of your pocket just like you would your wallet.
    I’d like to see sub-dermal RFID implants that can be used by just touching your hand to the scanner. Amal Graafstra (amal.net) and others are already blazing a trail here.

  • Fritz Thomas Klein

    Let me add an anecdote of many years ago with the first cotactless experiment in Switzerland. It involved public transport and a bus company. When walking on the pavement, your card got charged everytime a bus passed….