Contactless transactions have overtaken chip and pin payments for the first time in the UK, according to payment processing company Worldpay.
Worldpay says that contactless usage jumped by 30% between June 2017 and June 2018 and now accounts for the largest number of transactions of all the card payment options.
Contactless payment cards were first introduced by Barclaycard in 2007 and their usage has surged in recent years following increases in the spending limit (now £30) and the number of businesses that accept them.
Worldpay says that fashion retailers have seen the greatest shift from chip and pin to contactless, with the sector seeing a 415% year-on-year increase.
Betting shops and department stores also saw significant growth of mobile contactless payments.
The company says the trend towards tap-and-go is being seen nationwide, with Northern Ireland recording the biggest increase in both contactless and mobile contactless transactions.
Steve Newton, executive vice president at Worldpay says: “The data clearly shows that shoppers are moving towards more convenient forms of payment. This aligns to what we’re seeing in a number of sectors: time-poor consumers want instant access to their goods.
"Whether buying clothes or booking holidays, speed and ease are the watch words for meeting consumer expectations. The popularity of online shopping, mobile payments and click-and-collect is testament to this."
He adds: “The rise of contactless is part of a bigger story: it’s not simply about tap and go – it’s about convenience and reducing the parts of the shopping experience that customers find irritating, like queuing and waiting to pay.”
Worldpay predicts that during the final six months of 2018 UK shoppers could spend up to £38.5 billion via contactless transactions. Part of this growth comes from the rise in use of mobile wallets such as Apple Pay, Samsung Pay and Google Pay, which have seen a 114% increase on the high street in the year to the end of June.
The news comes after trade body UK Finance revealed that the number of contactless cards in the UK has grown to 111 million as of June 2017. Contactless now accounts for 34% of all card transactions in the UK.
Cash machine closures
However, the rise of contactless payments is not good news for everyone.
As a result of more and more people turning to contactless payments, demand for ATM withdrawals is falling.
This has led to cash machines closing at a rate of 250 a month as they become unprofitable to run, according to cash machine network provider Link.
Experts have warned that whole communities could be left without access to cash, affecting over two million people who are dependent on it for their day-to-day shopping.