UK consumers finally embrace contactless payments

Two new studies confirm there has been a huge increase in contactless payments made by UK shoppers using cards and mobile devices.

Barclaycard’s latest Contactless Spending Index shows that supermarket shoppers are increasingly turning to ‘tap and pay’ as their payment method of choice when making purchases up to the value of £30. In the last 12 months, contactless payments in supermarkets have risen 136% by value and 114% by volume as shoppers make higher value purchases with their contactless cards and devices and also use them more frequently.

According to Barclaycard, busy shoppers now favour contactless payment – with the average transaction seven seconds quicker than chip and PIN payment.

It’s not just supermarkets that have seen a surge in contactless transactions. Other sectors recording a big year-on-year increase include service stations (218%), department stores (147%), discount stores (120%), hotels and motels (100%) and convenience stores (87%).

Separate data from Worldpay focuses on mobile ‘tap and pay’ transactions, revealing that the total number of contactless transactions where a mobile device was used reached 38 million in 2016, with the total amount spent topping £288m. The number of mobile transactions as a percentage of all in-store transactions increased by 247%, with a notable rise in adoption following the launch of Android Pay in September.

Supermarkets and grocery stores accounted for just over half (54%) of all mobile ‘tap and pay’ transactions processed by Worldpay in 2016, while pubs, bars and restaurants made up 20% of the total and 9% of transactions took place in the pharmacy and beauty sector.

London is leading the way in adoption of the technology, with 32% of all mobile contactless payments taking place within the M25.

James Frost, chief marketing officer of Worldpay UK, commented: “Contactless cards have paved the way for rapid adoption of mobile payment systems, driving investment in infrastructure and familiarity among consumers. Today one in five of us will use the technology at least once a day, rising to a third of people in London.”

Worldpay noted that, although the volume of in-store payments via mobile remains a small fraction of the total (1.18%), the rate of adoption suggests the technology is quickly gaining a foothold in the ‘tap and pay’ market.

“As people get more used to paying for goods on their smartphone, mobile’s ability to bridge more effectively across online and offline retail channels will increasingly threaten the future of the traditional payment card,” Frost added. “Already more than half of UK shoppers say they’d happily leave their wallet at home and pay for everything on their smartphone instead.”

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