Half of all payments made using cards for the first time

The UK made further steps to becoming a cashless society last year, as new data released by UK Finance shows that during 2019, half (51%) of all payments were made using cards for the first time.

The data also revealed that the most popular type of card payments was through using debit cards, which accounted for 17 billion payments during 2019. Although lagging behind debit card payments, the use of credit cards increased by 7% last year and was used for 3.3 billion payments.

While cash payments fell by 15% last year, it was still the second most popular form of payment during the 12 months. In total, 9.3 billion payments were made using cash. “In 2019 we saw a further decline in cash use of 15% – although the fact that over nine billion payments were made in cash in 2019 shows how many people still depend on it,” said Natalie Ceeney CBE, chair of the Access to Cash Review. “This UK Finance data was taken before the impact of Covid-19, which has accelerated the shift to digital payments and further challenged the viability of the cash infrastructure. It’s essential that we ensure that everyone is included in our economy, and until digital payments work for everyone, we need to maintain people’s ability to access and pay with cash.”

Indeed, the UK Finance data found that many of the trends that have been escalated during the lockdown to control the Coronavirus pandemic were starting last year. For example, contactless payments were on the rise last year, increasing by 16% to account for 8.6 billion payments. During the Coronavirus pandemic, consumers have been advised to use contactless payments whenever possible to help stop the spread of the virus. In addition to this, contactless payments have been further boosted with the increase in the contactless limit to £45 in April.

Last year also saw an increase in remote banking across all age groups, with over four-fifths of adults using either online banking, mobile bank or telephone banking. This move towards remote banking has also seen an escalation during the lockdown as many banks limited in-branch banking services.

Stephen Jones, CEO of UK Finance, said: “An increase in ways to pay coupled with the change in people’s payment habits may have inadvertently gone some way to prepare the nation for the impact of Covid-19 on their daily lives. With consumers already using contactless payments and remote banking more than in previous years, these technological advances have allowed many people to shop and make payments safely from home or in store. The impact of Covid-19 may accelerate these habits for many customers; however, we are fully aware that not all customers are digitally-enabled, which is why we are working flat out to ensure people have access to cash and everyday banking services remain available to help the country through these difficult times."