UK Finance has just released its card spending update for August 2020. The figures demonstrate and confirm the increasing use of both contactless and debit cards as a percentage of total card usage by consumers.
During August, there were 1.2 billion debit and credit card transactions undertaken in the UK, which is 1.3% fewer than in July and 27.7 % fewer than in August last year. The total spend of £51.6 billion was 3.8% less than the previous month and 14% less than last August.
In terms of transaction volumes, contactless payments accounted for 45% of all credit card and 62% of all debit card transactions during August.
Of the total debit and credit card transactions, there were 709 million transaction undertaken using contactless, which is an increase of 7% more than in July but 2.3% less than the 726 million last August. The total value of contactless transactions was £8.2 billion in August, a 3.1% increase from July and a 19.3% increase on the figures from last August of £6.9 billion, reflecting the impact of the increase in the contactless spending limit.
The number of contactless credit card transactions was 14.6% higher than in July but 17.2% lower than last August. The number of contactless debit card transactions was 5.9% higher than July and 0.4% higher than last August.
Overall, total debit card usage by UK cardholders in August showed a 3.9 % increase in transaction volumes compared to the previous month and 2.5 % more than in August last year. Although total spend was 1.2% less than in July it was nevertheless 12.5% higher than last August, showing a definite increase in usage.
It is also interesting to note that outstanding balances on credit card accounts have contracted by 12.6% over the twelve months to August, as a result of repayments being greater than new borrowing in the year – possibly as consumers attempt to reduce their borrowings in the uncertain times that the coronavirus crisis has created.
It is always fascinating to review the trends in payments but never more so than this year in the light of the pandemic and its impact upon consumer spending behaviour and patterns.
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