Nearly one in three of all payments in the UK were made using contactless cards or with a smartphone or smart watch in 2021 (32%), a rise of 36% compared with transaction volumes in 2020, according to figures from UK Finance.
The figures also show that more than half of all consumer card payments in the country were contactless (58%).
Overall, debit cards were the most commonly used payment method, accounting for 19.5bn or 48% of all payments, followed by cash (15%), although the number of cash payments made in the UK fell by 1.7% to 6bn during 2021.
“As the economy reopened [after Covid-19 lockdowns], payment trends reverted towards their long-run patterns. Card payments increased and cash payments continued to fall,” the researchers say.
“Contactless payments — including payments initiated using contactless cards, mobile phones and watches — continue to grow in popularity.
“The increase in the contactless payment limit (to £45 [US$54.30] in April 2020 and then to £100 [US$120.6] in October 2021) expanded the range of purchases that could be made this way.
“Retailers also encouraged the use of contactless during the pandemic as a way of helping to facilitate social distancing in shops.
“Card acceptance devices have also become more widespread in recent years, especially among smaller businesses.”
“We expect cash usage to continue to fall and by 2031 cash will account for 6% of all payments made in the UK. Rather than the UK becoming a cash-free society over the next decade, the UK will transition to an economy where cash is less important than it once was but remains valued and preferred by many.”
UK Finance revealed the average UK contactless transaction value had risen by 30% in March and that seven in ten UK debit card transactions were now contactless in December 2021.
Merchant Machine identified the UK as one of the ten countries globally that are closest to becoming cashless societies earlier this month.
Nearly a third of all payments in the UK are now contactless was written by Tom Phillips and published by NFCW.