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.
