Customers can use the PayPass system for purchases under $100. The technology allows customers with microchip-enabled cards to use a specially-fitted EFT terminal without the card physically touching the machine.

Read: Caltex rolls out PayPass to metro stores

Coles general manager of strategy and financial services, Richard Wormald, said the terminals were introduced in order to speed up purchases.

"It is about providing ways to make payments easier, faster, and more secure every time customers visit our stores," he said in a statement.

According to MasterCard Australasia head of market development and innovation, Matt Barr, the deal with Coles means there are now 100,000 PayPass terminals in operation across Australia.