Cash use fell again in 2021 as contactless accounts for a third of all payments
Posted on in Business News, Cycles News
In its latest Payment Markets Report, UK Finance has said that the 40.4 billion payments made by consumers and businesses in the UK during 2021 represented a return to pre-pandemic payment volumes after a significant fall in 2020 due to Covid-19 lockdowns.
And, as the economy reopened, payment trends reverted towards their long-running patterns, with card payments increasing and cash payments continuing to decline.
The report shows that:
- Debit cards were the most used payment method, accounting for 48% of all payments.
- The number of cash payments fell by 1.7 per cent in 2021, although it remained the second most commonly used payment method, accounting for 15% of all payments in the UK.
- Faster Payments overtook Bacs Direct Credit as the payment method most frequently used by businesses.
- 57 per cent of UK adults used mobile banking in 2021.
- Almost a third of all payments in the UK were made using contactless methods in 2021.
Contactless payments – including payments initiated using contactless cards, mobile phones and watches – continue to grow in popularity. Almost a third of all payments in the UK were made via contactless methods in 2021, up 36% compared with 2020.
Contactless appears to be popular with consumers, due to the speed and security of transactions. The increase in the contactless payment limit (to £45 in April 2020 and then to £100 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.
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