Today sees the limit for contactless payments rise to £30, from the previous limit of £20, in a move that’s expected to deliver a new boost to NFC (near-field communication) payments, and could encourage the wider take-up of mobile payment methods.
Already, figures from MasterCard and Barclaycard show contactless spending has grown fast over the last year. MasterCard’s UK’ spending data shows the value of transactions using contactless payment methods grew by 560% in the last year, while Barclaycard says transactions have grown by 150% in value. MasterCard says individual consumers have on averaged doubled the number of times they tap to pay in each year since 2012, suggesting they are more confident in paying and that retailers are more likely to accept contactless payments. Meanwhile, Barclaycard says that its research shows 57% of Britons expect to pay by contactless more often following the rise in the limit.
“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,” said Mark Barnett, president of MasterCard UK and Ireland.
Visa Europe says the rise in popularity of contactless is now being felt with greater uptake of other NFC-enabled and digital payment technologies, from the use of Apple Pay via Apple Watches and the iPhone 6 to the use of bPay wearable products.
Kevin Jenkins, managing director of Visa UK and Ireland, said: “We believe that the new threshold increase to £30 could be the most significant to date, and has the potential to essentially redefine contactless usage. With contactless now accounting for one in 11 in-store Visa transactions, and Britons increasingly embracing the technology, our data shows that the rise could impact as many as 3 million Visa transactions per day in the UK, for a total of over £70 million.
“Supermarkets, clothing stores, department stores and pharmacy chains particularly stand to benefit from the increase, as 12-20% of Visa transactions at these retailer types fall into the £20-£30 category. This is an opportunity to increase convenience, improve service and deliver an enhanced shopping experience for a significant number of their customers.”
At the same time, an MBNA poll, carried out through One Poll, found that 60% of respondents who use contactless payment say it is easier than cash. Retailers who accept contactless payments currently include Boots, Starbucks, Marks & Spencer, Waitrose and Morrisons; Sainsbury’s has said it will offer the method in all its stores by the end of this year.