'Contactless payments' about to explode, but are they secure?

As contactless payment systems begin to gain traction across the country, questions are mounting over whether or not the security backing the RF-based technology is sufficiently advanced to prevent account fraud and the theft of personal information. With contactless payment systems about to get even more popular in the United States, there are fears that the wireless technology behind those systems is not secure enough for widespread adoption, despite assurances from Visa, MasterCard, and other major players.

Concerns over the security of contactless systems were heightened last week by a Federal Reserve decision that will allow for even more casual, low-cost purchases to be made across the country. In recent years, credit card companies have waived their signature requirements for so-called "small ticket" items in order to get a slice of the action. Visa, for instance, doesn't require your signature for purchases at or below $25.

The Federal Reserve sets rules for receipts, and last week the Feds said that purchases of $15 or less don't even require a receipt now, let alone a signature. The rule change will usher in a wave of vending machines and other automated payment systems, and many of them will support wireless, contactless payments.