Customers to pay with contactless cards

Pub customers will be able to pay for their two pints of lager and a packet of crisps with new contactless credit and debit cards using new readers to be rolled out by the UK banks.

The contactless option will be available on transactions of £10 or under. Customers will hold their card up to a secure reader to make their payment. The cards are designed to offer a fast, effective alternative to cash.

The rollout will start in London from The City to Canary Wharf in September, and nationally during 2008.

Pubs which decide to offer contactless transactions will be able to upgrade card readers, whicl customer will either have contactless technology added to existing credit or debit cards, or be issued with new cards.

More than 5m contactless cards are expected to be in circulation by the end of next year. Customers will not usually need a PIN, but a security feature will request a PIN from time to time.

John Bushby general manager, MasterCard Europe said: "Our experience testing MasterCard and Maestro PayPass among staff at Royal Bank of Scotland's offices in Edinburgh and London has shown us that consumers love the convenience, simplicity and security of being able to 'tap and go' when paying for everyday things such as newspapers, sandwiches and drinks.

"We are confident that consumers in the United Kingdom will be quick to adopt contactless payments as they are faster and more convenient."