Contactless At 10: One Third Of All Card Payments Made With A Tap

Contactless card technology has become so ubiquitous in the UK so rapidly that it’s often a disappointment when a retailer doesn’t offer the ability to pay with a tap – Sainsbury’s was a notable exception for a while.

The technology was first introduced to the UK ten years ago this month with the advent of the Barclaycard OnePulse card, which doubled as an Oyster card, and 6,000 trial locations.

Around 160,000 transactions a year were made in 2008, a figure which more than doubled the year after, and now more than £4 billion is spent each month using contactless.

Ten years of contactless

Its ease of use, wide adoption by retailers and banks, and an increase in the limit from £10 in 2007 to £30 in 2015 have contributed to its growth.

Contactless’s popularity – and therefore importance to retailers – is demonstrated by a new study by Visa which suggests two thirds of Brits have made a contactless payment since September 2007 and that a third of all payments are made in this way.

While initially it was coffee shops who offered the ability to ‘tap and go’, supermarkets, fast food and transport are the three most common locations, according to Visa.

A separate study from Barclays claims that more than half of all eligible transactions (I.e. under £30) are made using contactless, including nine out of ten at fast food outlets, pubs and bars. Its research says the clothing industry is the fastest growing sector, with contactless use rising by 321 percent.

Demographic Differences

Some smaller retailers and independent stores are still holding out, some on card payments altogether, which could harm business prospects, Visa’s research also shows there are some demographic differences.

Londoners are the biggest users of contactless, with 78 percent having made at least one payment, ahead of Wales on 70 percent and the East Midlands and South East on 68 percent, whereas just 41 percent of people in the North West or South West have done so.

Age also plays a factor. Whereas 76 percent of 18-35 year olds have used contactless, just 55 percent of the over 65s have done so. And, in general, those who use contactless are more likely to use other digital banking services.

“The introduction of contactless cards in the UK ten years ago was a watershed moment for consumers,” declared Kevin Jenkins, Visa’s UK MD. “Whether buying lunch, commuting without having to top-up, queuing at bars and festivals, or donating to charity, Brits have come to expect a painless payment experience.

“Yet there’s still room for the uptake of contactless to grow … the next ten years looks set to see contactless payments become an ever greater part of our day to day lives.”

Arguably one of the biggest drivers of adoption has been Transport for London (TfL). Contactless payments were first introduced on London’s buses in December 2012 and rolled out to the tube and rail services in September 2014. Such payments now account for two fifths of all journeys and more than 1bn contactless trips have been made on London’s transport network.

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