K Point Wealth explains whether digital wallets are safer than physical credit cards.
Contactless payments are now the norm in Australia, with phones and smartwatches often replacing traditional credit cards. But are Apple Pay, Google Pay and Samsung Pay actually safer?
Both options are convenient and protected under Australian consumer law—but digital wallets offer an additional layer of security that makes them increasingly appealing.
Fraud protection
Australia’s ePayments Code, regulated by ASIC, covers both credit cards and digital wallets. Card networks like Mastercard, Visa and American Express also provide protection. In most cases, you’re not liable for unauthorised transactions unless you’ve acted negligently—such as sharing your PIN or failing to report a lost card.
Banks also use continuous fraud monitoring to detect suspicious activity. If fraud does occur, you can typically block your card instantly via online banking and request a chargeback.
Digital wallets offer the same protections, with additional built-in security features including encryption, tokenisation (which replaces your card details with a one-time code), and biometric verification such as fingerprint or facial recognition.
Data and transaction security
When you use a physical card, your card number is shared with the merchant. If their system is compromised, your details could be exposed.
Digital wallets avoid this risk by using tokenisation. Your actual card number is never shared, meaning your data remains protected—even if a retailer’s system is breached.
Physical safety and convenience
Physical cards can be lost, stolen, or skimmed. In contrast, digital wallets are protected by your device’s security—such as a passcode or biometric authentication—making them significantly harder to misuse.
Backing from Australian banks
Most Australian banks support Apple Pay, Google Pay and Samsung Pay. Features typically include real-time transaction notifications, instant card freezing or replacement, and 24/7 fraud detection.
Acceptance in Australia and overseas
Contactless payments are widely accepted across Australian cities and major towns. However, some regional or remote areas may still rely on older EFTPOS systems, where a physical card may be required.
Similarly, when travelling overseas, it’s wise to carry a backup card in case digital payments aren’t supported or your device runs out of battery.
The bottom line
Digital wallets generally offer stronger security and better protection than physical credit cards.
That said, having a physical backup card remains a smart precaution.
If you’d like advice on managing your banking, payments or overall financial setup, get in touch with K Point Wealth. Our advisers can help you make confident, informed decisions.
Speak to a financial adviser
Call us on 07 3891 5666 or email admin@kpointwealth.com.au for a no-obligation chat.
