Card payments accounted for half (51 percent) of all payments in the UK in 2019. Remote banking increased across all age groups, with 72 percent using online banking and 50 percent now using mobile banking. Cash payments decreased by 15 percent to 9.3 billion payments but cash was still the second most frequently used method, representing a quarter (23 percent) of all payments in 2019. Card and contactless payments continued to increase in 2019, with card payments accounting for over half (51 percent) of all payments for the first time, according to the latest UK Payment Markets report from UK Finance.
Debit cards were the most used payment method in the UK with 17 billion payments, of which seven billion were contactless. Consumer use of credit cards also rose during 2019, up by seven percent to 3.3 billion payments, driven partly by the increase in contactless credit cards issued last year with 1.3 billion credit card payments made via contactless in 2019. The number of contactless payments across debit and credit cards increased by 16 percent to 8.6 billion. This continued move by consumers towards these payment methods may have helped prepare customers for the changes they now face due to the coronavirus lockdown.
Trends in payment habits may have also increased lockdown preparedness as supermarkets were the most popular place for contactless spending in 2019. Additionally, 48 million adults in the UK bought goods and services over the internet in 2019, as online shopping continued to increase across all age groups with nearly four-fifths of those aged over 65 (79 percent) shopping online in 2019.
Cash payments continued to decline in 2019, falling by 15 percent to 9.3 billion payments, although cash was still the second most popular payment method in the UK after debit cards. Changing retail trends, including the ever-increasing use of online shopping and the increase in card acceptance by retailers, have been a factor in both the declining use of cash and the increasing use of card payments. In addition, consumer preferences are undoubtedly changing in favour of using cards to make payments. The number of people who were not using cash or using cash just once a month has more than doubled in two years (3.4 million in 2017 and 7.4 million in 2019). Young people are leading the way in this respect, although there are people of all ages who rarely use cash, seven percent of people aged 65 or older were using cash once a month or less frequently during 2019.
Remote banking increased across all age groups in recent years. Over four-fifths of adults used either online banking, mobile banking or telephone banking in 2019 compared to three-fifths of the adult population in 2009, with 2019 being the first year in which consumers made over a billion remote banking payments.
While 98 percent of the population had a debit card in 2019, the industry recognises that some people still wish to and require access to cash, and it is committed to ensuring access to cash remains free and widely accessible for those that continue to need it. The Community Access to Cash Pilots initiative was introduced as an industry measure to improve access, helping local areas develop and support solutions that work best for them. For vulnerable customers, UK Finance also issued guidance on making payments safely during lockdown.
Links: https://www.ukfinance.org.uk/press/press-releases/cards-used-half-payments-first-time-last-year