Oops, I Paid for Your Fries

How many times have you accidentally set off the alarm at a store because an item you just bought was not properly de-alarmed before it was bagged? What if such technology trip-ups caused your credit card to be charged for something you didn't purchase?

The scenario isn't as far-fetched as you might think. New charging technology from MasterCard is aiming to replace the card swipe with the card wave -- enabling consumers to simply wave their plastic in front of a reader at the cashier station (like the technology used at some gas pumps).

The "no touch" card -- they call it "PayPass" -- will be in 4 million wallets by year's end, according to a Reuters story covering a MasterCard executive's speech at an industry conference. Currently, Citibank, HSBC (NYSE: HTB  ) , and Key Bank offer no-touch cards. Soon, the swipe will go the way of the Hustle.

But I don't have high hopes. This past weekend, I was forced to do a weird wet-hand jig in front of a paper towel dispenser supposedly equipped with a motion sensor. I finally banged the button and dried off, conjecturing that it was actually a camera in the machine.

A glitch with your New Wave MasterCard could be a lot worse than winding up on Candid Camera. Imagine walking too close to the checkout at Motley Fool Stock Advisor pick Gap (NYSE: GPS  ) just as a shopaholic's order has been totaled. "That'll be $447.22. Thanks, Ms. Yochim, for shopping at The Gap." Only you've already left the store.

OK, such a scenario isn't likely -- MasterCard folks assure me that the card must be within inches of the reader to "talk" to the cash register -- but still, will the wave save that much more time than the oldfangled swipe?

"It's just one of the ... breakthroughs in technology that we're pursuing in order to increase convenience and boost usage," said Ruth Ann Marshall, America's president for MasterCard.

"Boost usage." Ugh. Convenience "cheques," teaser interest rates, payment "holidays," and rewards were all designed to boost convenience and usage, too. Used responsibly (by following the 8 Commandments of Credit), they're great. But that's not what lenders had in mind when they rolled out these services. What they did was offer a convenient way for lenders to tack on fees ("Dear Valued Customer, Thanks for the $24 billion bonus") and for consumers to borrow more money than they can afford to spend. Great for banks, bad for consumers' bottom lines.

In the end, you can blame banks only so much. They may hand you the hammer and nails for your financial coffin, but it's stupid human tricks that'll really bury you. Don't pay your bill by their rules, and you won't end up on Candid Credit Card Camera.

Gap is a Motley Fool Stock Advisor pick. For a 30-day free trial of the best of David and Tom Gardner's picks, click here.

Dayana Yochimdoesn't own any companies mentioned in this article. The Fool'sdisclosure policyis not yet available on microchip.


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