The contactless card industry’s 2016 got off to an excellent start as new figures from the UK Cards Association showed that the NFC cards now account for 10 per cent of all card transactions, the first time this milestone has been reached.
The figures for October 2015 revealed that 120.5 million contactless card payments were made, accounting for 10.3 per cent of all card transactions, and encouragingly marking a 3.7 per cent increase from a year ago.
In June, the British public spent £567m and in August we tapped away £634m. Skip to October, after the contactless spend limit was raised to £30, and we managed to spend a staggering £929.8m.
The average value of a contactless payment is £7.72, up from £7.35 in September when the limit for a single payment rose to £30.
“With one in 10 card payments now contactless, it’s clearly the preferred way to pay for millions of consumers. The rise in the contactless limit to £30 earlier this year means there are now even more opportunities to make a fast, easy and secure contactless payment,” said Richard Koch, head of Policy at The UK Cards Association.
Looking at contactless spending in action, contactless spending in pubs and bars has almost doubled (up by 92 per cent) since the contactless limit rose from £20 to £30 in September, according to Barclaycard data.
Contactless spending in fast food outlets and in restaurants has also jumped by 62 per cent and 51 per cent respectively over the same period.
Interestingly, Barclaycard also noticed a sense of iration when respondents were faced with older payment methods. More than 8 in 10 consumers use less cash than they did a year ago with 19 per cent annoyed if they can’t pay using contactless cards or devices, the bank said.
What’s in store for 2016?
All this data, Barclaycard says, suggests that 2016 will be the year of high value purchases. Over the next year, consumers, now used to the higher contactless spend limit, will be looking to make even higher value payments more quickly – which will involve using a mobile device with Chip and Pin authorisation.
“In 2015 we’ve seen contactless become an even more popular way to pay for small transactions, so much so that we can even get frustrated if a retailer doesn’t offer ‘touch and go’ as an option. As the consumer appetite for new ways to pay continues to grow, particularly with the upcoming launch of high value payments and the continuing growth in wearable payment devices, we’re expecting 2016 to be another recording breaking year for contactless,” said Paul Lockstone, managing director at Barclaycard.
In this guest post, Anthony Walton, CEO of Iliad Solutions, explores how businesses and regulators can increase the safety and efficiency of transactions, and introduce technological advances into the system.
Payment terminals have stayed the same over the last 10 years, with steady advances in contactless and mobile wallet transactions. Retailers and brands are making a conscious effort to get closer to consumers.