News & Views - Savantor

Cash, cheques and contactless payments

Friday, 16 September 2016

Several milestones have been reached over the past month in the world of UK payments.

On 13th September, the Bank of England launched a new plastic £5 note. Whilst its advent has been heralded as an ‘exciting development’ in some quarters, nevertheless there has been news of other payment methods which serves only to remind us that the use of cash is becoming increasingly less popular compared to mobile and contactless payments.

According to new figures released by research analyst Mintel, contactless card use in the UK has overtaken cheque usage for the first time. Their research shows that cheques have been used by 31% of UK consumers over the past three months, down from 40% who used them to make a payment during 2015. This decline makes cheques the least popular form of payment, with contactless debit card use rising from 28% in 2015 to 39% and contactless credit card use rising from 28% to 34%.

Meanwhile, data gathered by the UK Cards Association indicates that spending using contactless in the first half of 2016 has already overtaken figures for the whole of 2015. According to their figures, £9.27 billion was spent using contactless methods between January and June of this year, more than the total 2015 contactless spend of £7.75 billion. This comprised of 1.1 billion contactless transactions in the first six months of 2016, compared to 1.05 billion for the whole of 2015.

In June of this year, 18% of purchases were made using contactless cards, compared to 7% in June 2015.

It is widely expected that the growth in usage of contactless cards will continue to rise during the rest of 2016. The latest Barclaycard Contactless Spending Index, which monitors the shopping trends of millions of UK customers, shows that usage has increased 173% by value and 112 % by volume in the year to end of July. Interestingly, usage in the over 60’s age group is growing so quickly that the number of users in this age group is now greater than those aged 18-25.

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