A total 13.2 billion card payments were made at the end of 2017, compared to 13.1 billion cash payments, therefore overtaking the latter for the first time, according to the latest UK Payments Market report.
This beats previous forecasts by one year when debit cards would overtake cash within one year. In comparison, cash payments were down 15 per cent year-on-year.
Almost two thirds of Britons are now using contactless payments as the number of payments has doubled in one year. Despite this, cash is predicted to remain the second most frequently used payment method in the UK in 2027.
The popularity of contactless payments among UK consumers is a key driver of debit card growth. In total, across both debit and credit cards, the number of contactless payments increased by 97 per cent during 2017 to 5.6 billion. Almost two thirds (63 per cent) of people in the UK now use contactless payments, and no age group or region falls below 50 per cent usage.
An increasing acceptance of card payments by smaller businesses and people becoming ever-more comfortable and familiar with the speed, ease and security of making low-value payments has also made the use of debit cards more popular. By the end of 2017 there were nearly 119 million contactless cards in circulation and, with customers and businesses increasingly choosing to use contactless cards and card acceptance devices, it is anticipated 36 per cent of all payments across the UK will be contactless in 2027.
UK Finance chief executive Stephen Jones 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.
“These trends are likely to shift further over the next decade. Developments such as Open Banking are expected to bring extensive changes to the payments landscape, something that will likely shape how we interact with our money in the coming years.”
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