Debit card payments outstripped cash for the first time last year as more and more consumers turn to contactless payments for everyday purchases.
A total of 13.2 billion debit card payments were made at the end of last year – an 15 per cent increase on the previous year – and compared with 13.1 billion cash payments, according to trade body UK finance.
The figures reflect the fact that almost two third of Britons are using contactless as their preferred method to pay for goods, as better access to card payments and new technology offer choice and convenience to customers.
The use of notes and coins dropped by 15 per cent last year, with an estimated 3.4 million people hardly using cash at all during the year. Despite this, cash is predicted to remain the second most used payment method until 2027.
Stephen Jones, chief executive of UK Finance said: “The choice of payment options available in the UK is allowing people to choose to pay the way that best suits them. But we’re far from becoming a cash-free society and despite the UK transforming to an economy where cash is less important than it once was, it will remain a payment method that continues to be valued and preferred by many.
“These trends are likely to shift further over the next decade. Developments such as Open Banking are expected to bring extensive changes to the payments landscape, something that will likely shape how we interact with our money in the coming years.”
UK Finance predicted that over the next decade, the number of debit card payment will grow by more than any other payment method, by 49 per cent to 19.7 billion payments in 2027, thanks to the continuing popularity of contactless payments, online shopping and increasing levels of card acceptance even among small businesses.
Contactless cards alone will account for 36 per cent of all payments in 2027, up from 15 per cent in 2017.