Spending by British consumers on their contactless cards has increased more than five-fold in the last 12 months, according to MasterCard’s UK spending data. Cardholders have driven 560% year-on-year growth in the value of transactions, up from a 373% increase in the year to July 2014, showing that the adoption of contactless payments is continuing to accelerate.
The UK ‘tap & go’ limit for transactions on all contactless payments cards will increase from £20 to £30 on September 1st in an industry-wide initiative. As such, MasterCard expects to see further growth in the adoption of contactless payments by its cardholders. Further growth will also be encouraged with mobile contactless payments, which will allow values over £30 to be made.
The number of contactless card transactions made with MasterCard have already quadrupled since last summer (457%).
At the start of 2012, the year in which the limit was raised to £20, the average contactless purchase by cardholders was for £4.52. In July this year that had increased to £7.29, a good indication of the need to raise the contactless limit to £30.
Mark Barnett, President of MasterCard UK & Ireland said: “The pace of growth we are seeing in contactless is getting ever faster as we rely less and less on cash. Consumers enjoy the speed and convenience of tapping to pay. We expect this upward trend to persist with consumers continuing to migrate to contactless card payments and increasingly to mobile payments, as we work with partners such as Apple to enable more convenient ways to pay.”
MasterCard’s data also shows that each year since 2012, individual cardholders have on average doubled the number of times they tap to pay, indicating more confidence among consumers and ever increasing acceptance of contactless by retailers.
In an example of the increasing acceptance, MasterCard has worked hard with all of the stadia hosting this year’s Rugby World Cup matches to ensure that they are all ready to take contactless payments. Twickenham alone has connected over 450 terminals including all of its shops, bars and concession stands.
Barnett added: “At this year’s Rugby World Cup, fans needn’t spend so much time queueing for drinks at half-time. We want to speed up the payment process so they don’t miss any of the action. Contactless shows its versatility very well in the big stadium environment, whether fans want to pay with cards or Apple Pay.”
Overall levels of fraud on contactless cards remain very low, with just £153,000 of losses during 2014 compared with total spending of £2.32bn, according to UK Cards Association figures. This represents just 0.7p in every £100 spent on contactless, one of the lowest fraud rates for any kind of payment.