Cards make up over half of UK payments for first time

Card and contactless payments continued to increase in 2019, with card payments accounting for over half (51 per cent) of all payments for the first time, according to UK Finance.

The latest UK Payment Markets revealed that debit cards were the most used payment method in the UK, with 17 billion payments, of which seven billion were contactless.

Consumer use of credit cards also rose during 2019, up by seven per cent to 3.3 billion payments, driven partly by the increase in contactless credit cards issued last year - with 1.3 billion credit card payments made via contactless in 2019.

The number of contactless payments across debit and credit cards increased by 16 per cent to 8.6 billion. This continued move by consumers towards these payment methods may have helped prepare customers for the changes they now face due to the coronavirus lockdown.

Cash payments continued to decline in 2019, falling by 15 per cent to 9.3 billion payments, although cash was still the second most popular payment method in the UK after debit card. The number of people who were not using cash or using cash just once a month has more than doubled in two years - 3.4 million in 2017 and 7.4 million in 2019.

Young people are leading the way in this respect, although there are people of all ages who rarely use cash, seven per cent of people aged 65 or older were using cash once a month or less frequently during 2019.

Remote banking increased across all age groups in recent years. Over four-fifths of adults used either online banking, mobile banking or telephone banking in 2019 compared to three-fifths of the adult population in 2009, with 2019 being the first year in which consumers made over a billion remote banking payments.

Stephen Jones, chief executive of UK Finance, said: “An increase in ways to pay coupled with the change in people’s payment habits may have inadvertently gone some way to prepare the nation for the impact of the pandemic on their daily lives.

"With consumers already using contactless payments and remote banking more than in previous years, these technological advances have allowed many people to shop and make payments safely from home or in store," he continued.

"We are fully aware that not all customers are digitally-enabled which is why we are working flat out to ensure people have access to cash and everyday banking services remain available to help the country through these difficult times.”

Additionally, 48 million adults in the UK bought goods and services over the internet in 2019, as online shopping continued to increase across all age groups with nearly four fifths of those aged over 65 (79 per cent) shopping online in 2019.

Separate data from Barclaycard Payments also revealed that more than 90 per cent of face-to-face transactions are now made using contactless payments methods, following the COVID-19 pandemic.

The bank's payment arm processed over 25 million contactless payments above £30 since the new £45 limit was introduced at the start of the lockdown period, in a bid to reduce risk for card users.

The total value of contactless transactions above the £30 limit was at £900 million, with an average transaction value of £36.29. More than half (57 per cent) of in-store transactions at small businesses between £30 and £45 are now made using contactless.

Rob Cameron, chief executive of Barclaycard Payments, said: “Just as consumers are becoming more comfortable with contactless and digital payments, we’ve also witnessed this same behavioural shift with our merchant clients.

"Not only are they placing more emphasis on their payments systems, they’re also considering how providing a quick and easy payments process improves the overall customer experience," he continued. “Coronavirus has only accelerated this trend, with many traditionally face-to-face businesses switching to online and distance selling for the first time in order to adapt and grow, and it will be interesting to see how card payments continue to evolve in the months ahead.”

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