The simplicity and popularity of contactless will see card payments overtake cash within five years, according to Payment Assocation
Card payments will be more popular than cash in the UK within five years, according to a report from industry body The Payments Association, partly thanks to the popularity of contactless transactions.
By 2021, card payments are predicted to reach 14.5 billion, overtaking the forecast 13.0 billion cash payments for the first time. And by 2025, notes and coins will drop to being used for just over one in four (27 percent) of payments, the report claimed.
Overall, the study found 38 billion payments were made in the UK by consumers and businesses during 2015 – the equivalent of more than 72,000 payments every minute. This is set to rise to around 79,000 payments per minute by 2025.
Despite this supposed shift in the balance, cash was still found to be the most popular payment method in 2015, accounting for roughly half (45.1 percent) of all payments.
However last year has seen an increasing growth in card payments, as the average UK adult made 20 card payments per month in 2015, of which around one in 10 were contactless. The report estimates that by 2025 consumers will use a debit, credit or charge card virtually every day (30 times per month) and almost half of these transactions – 14 per month – will be contactless, or made using a mobile phone app such as Apple Pay or Android Pay.
Recent figures from Visa Europe found British consumers are the biggest users of contactless payments in Europe, making more than 153 million contactless transactions in the 12 months leading up to April 2016.
Online and mobile banking is also predicted to increase, as more consumers look for a better way to access their finances on the go. In 2015 more than two-thirds of adults regularly used online banking, the report found, with a third using mobile banking.
However, there were still more than 546 million cheque payments recorded last year, showing that the supposedly dated method of payment still has some fans.
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