Barclaycard and taxi firm Computer Cab, have joined forces to offer customers a cashless way to pay for taxi fares.

The Visa based Wave and Pay credit card, will be available later in the year and  allow passengers to pay for taxi journeys of up to £10, by passing a specially created wireless credit card in front of an electronic reader installed in a Computer Cab vehicle.

The initiative aims to allow people to efficiently pay for a journey and reduce the amount of cash people they must carry around with them, something Gemma Smith spokeswoman of UK payments agency, APACS said would be a “benefit.”

“Two-thirds of all payments are currently made in cash, which gives no refunds if people fall victim to fraud or simply get their cash stolen,” she told Computeractive.

“As the Wave and Pay is a visa card people are entitled to fraud protection guarantees that comes with any credit or debit card,” she said.

However, because payments are only up to £10 consumers will not be covered under section 75 of the consumer credit act as credit card companies are only obliged to pay back a customer for any losses or repairs to goods that cost over £100 and not exceed £30,000.

Although the wave-and-pay scheme does not require a PIN, Barclays, which has also announced plans to use the system in shops later this year, said the fraud elements are “minimal.”

Andrew Bond, spokesman for Barclaycard, said: “Although people can make transactions up to £10 in participating shops and taxi’s the fraud implications are low."

“Fraudsters not interested in using small amounts to buy things and going from shop to shop is incredibly time consuming for them,” he said.

Ms Smith agreed that the public were not being put under any risks: “Initiatives like these have already been implemented in the US and we have not seen any evidence of rising fraud," she said.

Both Ms Smith and Mr Bond also reassured people that if they were found to be genuine victims of fraud then they would be covered by Barclay’s fraud protection.

Although Barclays may be ahead of the game with its announcements APACS also said that many more companies will be rolling out such schemes by autumn this year.

As well as for small payments in cabs and shops, the card schemes will also be used for things such as carparks and vending machines.

On the credit card subject: Barclays also announced plans earlier this week to launch a Green credit card which will give half its profits to environmental projects dedicated to reducing  global carbon emissions.

Barclaycard Breathe, to be launched later on in the year, will aim to help those who use it, lead a greener lifestyle by offering discounts and lower rates on green products, for example energy saving products and greener transport options.

The card will be made from PETg a more environmentally friendly alternative to current PVC cards and all statements and marketing will be issued online.