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Barclays customers are to be sent new "contactless" debit cards from today which could expose them to increased chances of falling victim to card fraud.
The bank said the cards, which are being sent to all customers whether they ask for them or not, will make paying by debit card easier. But customers who have their cards stolen could find they are liable for up to £50 of any losses.
Barclays is the first bank in the UK to roll out the technology to all current account customers as "a standard feature of most new and replacement debit cards".
Up to 3 million customers are expected to be using contactless debit cards by the end of the year and the majority of Barclays debit card customers will have one by 2011.
The cards are fast to use, as they allow holders to pay for goods costing up to £10 by simply waving the card before a special reader without the need to enter a pin or insert the card into the retailer's terminal.
Around 8,000 stores accept contactless payments including many outlets of Pret A Manger, Coffee Republic, Eat, Krispy Kreme and Threshers. Thousands of independent retailers are installing the "wave and pay" technology every week.
However, the cards are controversial because they are more likely to expose the owner to any losses incurred before they report the card stolen.
Anyone finding a wallet containing a contactless card could immediately hit the stores using this technology to make a number of small purchases in the hope the card was still active.
A spokeswoman for Barclays denied it was exposing its customers to a new risk. "A lost and reported card will be immediately cancelled, and no longer usable. A card that has been lost but unreported for whatever reason can only be used four or five times before a pin number is demanded. If the card was used fraudulently before it was reported missing we would look at the refund circumstances on an individual basis."
She said the new cards will continue to work as normal and require a pin for other transactions, including bigger purchases and ATM withdrawals.
According to the UK payments association, Apacs, consumers are liable for the first £50 if their lost debit card is used by thieves before they cancel it.
"The banks mostly refund customers who lose out if someone takes their debit card and uses it before it is reported missing, said an Apacs spokeswoman. "I feel this will happen here. It would be in Barclays' interest to cover any losses that resulted from its contactless cards to encourage greater take-up of the service," she said.
However, in recent years the banks have been coming down hard on customers who have had money inexplicably taken from their accounts, mostly due to internet-based fraud. In some cases they have failed to cover losses, leaving consumers angry and frustrated.
In September 2007, Barclaycard introduced contactless technology on credit cards when it launched Barclaycard OnePulse, the three-in-one Oyster travel, credit and contactless card.
All Barclaycard Platinum cards now include contactless technology, and more than 1.5m Barclaycards in circulation are contactless-enabled.
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