Whilst reports suggest mobile payments could dominate in the future, cards – contactless in particular – are experiencing a meteoric rise in usage in the present.
According to the UK Card Association, 35 million card payments were made in 2014, marking a 12.1 per cent increase from the previous year.
In total, all UK-issued cards (debit, credit and charge) spending, both domestically and overseas added up to a record £600.3 billion for 2014. This marked an 8.2 per cent increase.
UK consumers spent a staggering £19,000 per second on their cards last year; the number of purchases also increased by more than a tenth (12.1 per cent) to 12.96 billion. The increase can be attributed to contactless cards leading people to make more lower-value purchases, thus moving away from traditional cash payments.
Debit cards are still the most popular method of payment with 91 per cent of adults (48.5 million people) in possession of at least one.
The report also noted a drop in the overall amount of cash withdrawn last year: a 2.3 per cent fall to £196 billion, the second annual drop in a row, which takes the amount withdrawn to 2008 figures. This is perhaps another indicator that cash is on the way out. A further indicator that another nail is being prepared for cash’s coffin is the fact that the amount of cash-backs in shops fell nearly a tenth (8.8 per cent) last year to £6.1 billion.
The downfall of cash is directly connected to the surge in popularity of contactless cards. Total spending on contactless cards has increased three-fold to £2.32 billion over 319 million transactions.
“Consumers are making more than twice as many card payments every day than they were ten years ago, a clear sign of how people are now choosing to use the cards in their wallet rather than cash,” said Richard Koch, head of Policy at the UK Card Association.
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