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Shift to cashless society

Cards used for over half of payments for first time

RBS fingerprint card

Cards are now more popular than cash (pic: Terry Murden)

Card and contactless payments last year accounted for more than half (51%) of all payments in the UK for the first time, hastening the move towards the cashless society.

The number of contactless payments across debit and credit cards increased by 16% to 8.6 billion.

Debit cards were the most used payment method, with 7 billion of the 17 billion total being contactless. Use of credit cards rose by 7% to 3.3 billion payments.

UK Finance says the shift may have helped prepare customers for the changes they have faced during the coronavirus lockdown when they have been discouraged from handling cash and have bought more items online.

Supermarkets were the most popular place for contactless spending in 2019.

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Additionally, 48 million adults in the UK bought goods and services over the internet in 2019, as online shopping continued to increase across all age groups with nearly four-fifths of those aged over 65 (79%) shopping online.

Cash payments fell by 15% to 9.3 billion payments, although cash was still the second most popular payment method in the UK after debit cards.

The number of people who were not using cash or using cash just once a month has more than doubled in two years (3.4 million in 2017 and 7.4 million in 2019).

Young people are leading the way in this respect, although there are people of all ages who rarely use cash, including 7% of those aged 65 or older using cash once a month or less frequently.

Remote banking increased across all age groups in recent years. Over four-fifths of adults used either online banking, mobile banking or telephone banking in 2019 compared to three-fifths of the adult population in 2009, with 2019 being the first year in which consumers made over a billion remote banking payments. 

While 98% of the population had a debit card in 2019, the industry recognises that some people still wish to and require access to cash, and it is committed to ensuring access to cash remains free and widely accessible for those that continue to need it.

The Community Access to Cash Pilots initiative was introduced as an industry measure to improve access, helping local areas develop and support solutions that work best for them. For vulnerable customers, UK Finance also issued guidance on making payments safely during lockdown. 

Stephen Jones, CEO of UK Finance, said: “An increase in ways to pay coupled with the change in people’s payment habits may have inadvertently gone some way to prepare the nation for the impact of Covid-19 on their daily lives.”

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