Morocco Sees Surge in Contactless Payments Amid COVID-19, Limits Raised Twice

The dematerialization of money is a reform that is revolutionizing the business sector. It has experienced a boom with the advent of coronavirus. Despite the concerns of some economic agents, the contactless payment system has experienced strong expansion with a threshold of increase going from single to double and then triple.

The first increase took place in April 2020 as part of the implementation of barrier measures against Covid-19. This increase had gone from 200 DH to 400 DH. The second came with the directives of the CMI and Visa at the beginning of this month to bring the card verification limit to 600 DH.

In transactions, economic agents favor this means of payment, which should contribute significantly to the reduction of cash in circulation. The advantages of contactless are ease, fluidity, speed and security. This payment method, according to CMI figures, has seen an increase in the number of transactions from 4.7% in January 2020 to 25% in December of the same year. The amounts paid by this payment mechanism have also seen an increase from 1.5% to 11.1%.

In the press release announcing the second increase in the limit of payment without a PIN code, the CEO of the CMI, Mikael Naciri, said that "contactless payment has been very favorably received by merchants and cardholders, given the significant benefits that this payment method provides in terms of convenience and security".

By increasing the card verification limit to 600 DH, the CMI hopes for more contactless payments from merchants and their customers. The CEO of the CMI reveals that the objective is to reach a global rate of 40% of contactless payments by the end of 2021.

Reliability and security of transactions

It is impossible to make an involuntary transaction on a contactless payment terminal. The risk that haunts some consumers who fear cybercrime is zero, we are assured. The CMI confirms on its website and explains that the contactless function of the card is inactive when the user is not in proximity to a payment terminal. In addition, the confidential code is requested as soon as a certain number of consecutive contactless payments are made.

Remote management between risk and controls

The increase in the ceiling to 600 DH will lead to changes in the various authorization systems of the banks, said Nasr-Eddine Belghiti, CEO and founder of IPRC, a company specializing in ATM remote management. Disturbances may occur if the validation tests are not carried out exhaustively, he argues. As a result, the risk due to changes exists, but so do the controls.

"Our vigilance will be increased in the first few weeks of implementing this new ceiling, in order to anticipate any behavior that could generate fraud or unexpected behavior. We are putting in place with our clients new rules for detecting behaviors that could be of fraudulent origin or processing error, and we are supervising the monetary flow for our clients 24/7," said Mr. Belghiti.

He recommended that the user increase his vigilance when using these payment instruments and consult the history of his operations on mobile apps, web banking, ATMs, etc. Finally, the user must contact his bank’s call center for any suspicious transaction. Ultimately, "the regulations in force give the cardholder protection instruments. In addition, our clients are proactive in contacting their client in case of suspicion about the origins of a transaction," concludes Belghiti.