UK Finance‘s latest card spending data, recorded in December 2021, reveals that the average amount spent per contactless card transaction rose by almost 30 per cent following the contactless spending limit increase from £45 to £100 in October last year.
Prior to the contactless limit increase, the September average spend per contactless payment stood at £11.86. However, this figure increased slowly and steadily to £15.30 by December, in correlation with the limit increase.
The increased limit came into effect on 15 October, but it took a period of time for retailers and payment providers to update their systems and offer the new £100 limit, which means the increase in the average payment took time to show up.
For 2021 as a whole, the card spending data shows a total of 13.1 billion contactless payments were made in the year – equivalent to 415 transactions every second. This is up 36 per cent compared with 2020 and 52 per cent higher than pre-pandemic levels in 2019.
The total value of contactless transactions in 2021 also increased, reaching £165.9 billion. This is 46 per cent higher than in 2020 and 106 per cent more than 2019.
Total number of contactless transactions
| Year | Number of contactless transactions | Value of transactions |
| 2019 | 8.6 billion | £80.5billion |
| 2020 | 9.6 billion | £113.5billion |
| 2021 | 13.1 billion | £165.9billion |
Contactless card payments remained the most popular form of transaction in December 2021, and continues to increase. At its highest level, contactless accounted for 69 per cent of all debit card transactions, and 56 per cent of all credit card transactions.
Why are consumers turning contactless?
There are many different elements to consider when trying to comprehend why contactless transactions are on the up.
Aside from the wider scope of contactless capabilities thanks to the limit increase, it would also be worth noting how the prevalence of Covid-19 accelerated its use.
Contactless is a far more hygienic form of payment and proved to be particularly practical when trying to prevent the spread of the virus.
However, as the data suggests, the value and volume of contactless payments increased as the year drew on. This could quite possibly be due to the overall increase in consumer spending throughout these months; especially in regards to the festive period.
What’s more, many payment providers are beginning to offer contactless as a standard feature of the cards they provide. Correlated with an equal rise in paytech, and contactless cards becoming ever-closer to mobile devices, it’s unsurprising to see figures such as these.
A recent example of how this is coming into fruition includes the American company Apple, which lately announced plans to introduce Tap to Pay on iPhone.
The new capability is set to empower merchants across the US, from small businesses to large retailers, to use their iPhone to accept Apple Pay, contactless credit and debit cards, and other digital wallets through a simple tap to their iPhone; with no need for additional hardware or payment terminals.
“These figures show the continued popularity of contactless payments, as well as the fact people are making higher-value payments,” explains Lee Hopley, director of economic insight and research at UK Finance.
“From October last year the new £100 limit was rolled out and it gives customers greater choice about how they pay for things like their weekly shop or a tank of fuel.
“For 2021 as a whole there were over 13 billion contactless transactions, which was a significant increase on the previous year, and in December a record 69 per cent of all debit card payments were contactless purchases.”
