Secure contactless credential exchange

A method for securely providing a credential, comprising:

• registering a user device with a contactless transaction service, wherein a primary payment credential of a payment account is associated with a user of the user device;
• receiving, by a credential device and from the user device and based on registering with the contactless transaction service, an electronic message that includes a request to initiate a contactless transaction, associated with the contactless transaction service, between the user device and a specific transaction terminal operated by a merchant,
• wherein the electronic message from the user device includes a first unique identifier of the specific transaction terminal, and
• wherein the electronic message is transmitted from the user device based on the user device receiving an input of information provided at the specific transaction terminal for the contactless transaction service;
• generating, by the credential device, based on authenticating the electronic message, and based on the first unique identifier, a virtual credential that is associated with the merchant,
• wherein the virtual credential is linked to the primary payment credential, and
• wherein the virtual credential is configured as a substitute for the primary payment credential;
• and
• transmitting, by the credential device, information associated with the virtual credential to the specific transaction terminal,
• wherein transmitting the information associated with the virtual credential causes authorization of the contactless transaction.

A non-transitory computer-readable medium storing a set of instructions, the set of instructions comprising:

• one or more instructions that, when executed by one or more processors, cause the one or more processors to:
• register a user device with a contactless transaction service, wherein a primary payment credential of a payment account is associated with a user of the user device;
• receive, by a credential device and from the user device and based on registering with the contactless transaction service, an electronic message that includes a request to initiate a contactless transaction, associated with the contactless transaction service, between the user device and a specific transaction terminal operated by a merchant,
• wherein the electronic message includes a first unique identifier of the specific transaction terminal, and
• wherein the electronic message is transmitted from the user device based on the user device receiving an input of information provided at the specific transaction terminal for the contactless transaction service;
• generate, by the credential device and based on authenticating the request, and based on the first unique identifier, a virtual credential that is associated with the merchant,
• wherein the virtual credential is linked to the primary payment credential, and
• wherein the virtual credential is configured as a substitute for the primary payment credential;
• transmit, by the credential device, information associated with the virtual credential to the specific transaction terminal;
• and
• receive information indicating that a transaction associated with the virtual credential has been processed,
• wherein the transaction is associated with the contactless transaction.