Contactless payment boom means cash is no longer king

UK Finance said a surge in contactless payments helped debit card transactions hit 13.2 billion in 2017, compared with 13.1 billion for cash.

The milestone was reached earlier than forecast – with two-thirds of consumers now taking advantage of the ability to tap their card against a reader to make a payment of £30 or below.

The body’s UK Payment Markets report said 5.6 billion contactless payments were logged for both credit and debit cards last year – a rise of 97% on 2016 – with people aged between 25 and 34 the most frequent users.

It estimated there were 3.4 million people who did not use cash to pay for things at all last year as bank branches continue to decline and free-to-use ATMs also come under pressure.

:: Nearly 60 bank branches closing every month

UK Finance forecast that contactless payments would account for a third of all transactions by 2027.

But its study says the UK is far from becoming a cash-less society as notes and coins will easily remain in second place over the next decade.

Stephen Jones, the body’s chief executive, said: “The choice of payment options available in the UK is allowing people to choose to pay the way that best suits them.

“But we’re far from becoming a cash-free society and despite the UK transforming to an economy where cash is less important than it once was, it will remain a payment method that continues to be valued and preferred by many.”

Adam Herson, business development director at Barclaycard Mobile Payments, said of the trends identified: “More recently, we have seen a surge in the use of wearable and mobile payments, creating new, exciting opportunities for both shoppers and brands.

“Consumers are increasingly able to match their payment accessory or device to their lifestyle or fashion taste.”

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