The spending limit for contactless payments in the UK will be increased to £100 from the current limit of £45 on 15 October, the banking trade association UK Finance has said.
The decision to increase the limit was taken by the Treasury and the Financial Conduct Authority after public consultation and discussions with the retail and banking sectors.
The last time the cap was raised was relatively recent – a more modest £30 to £45 in April 2020. Although considered for some time, that increase was accelerated due to the Covid-19 pandemic as a way to reduce the amount necessary contact person in stores.
While the new £100 limit will be available from October, it will take some time for all retailers to be implemented, UK Finance said, given the number of terminals that will need to be updated to accept the new limit.
Alternatives such as mobile payment platforms such as Apple Pay or Google Pay have no cap when authenticated via biometric technologies such as fingerprint or facial recognition.
David Postings, chief executive of UK Finance, said: “Contactless payment has proven to be very popular with consumers and more and more transactions are being made using contactless technology.
“The increase in the limit to £100 will allow people to pay for higher value transactions, such as their weekly shop or refueling their car.
“The payments industry has been working hard to put in place the infrastructure to allow retailers to update their payment systems so they can start offering their customers this new higher limit.”
Finance Minister Rishi Sunak said: “Raising the contactless limit will make it easier than ever to pay safely and securely – whether that be in the local shops or your favorite pub and restaurant. As people return to the high street, millions of payments will become easier, which is a welcome incentive for retailers and shoppers.”
When contactless cards were first introduced in 2007, payments were capped at £10 before rising to £15 in 2010, £20 in 2012, £30 in 2015, and £45 in April last year.
In March, Gareth Shaw, head of money at consumer research and advice organization Which?, warned that the rise could make it easier for fraudsters to spend people’s money.
He said: “The risk of falling victim to contactless card fraud is currently low, but there is a potential for thefts if criminals take advantage of the increased spending cap to maximize the amount they can steal.”
Last February, Sunak was urged to protect Britain’s money economy as millions still relied on it. Later, a new trial was set up to improve people’s access to cash in smaller towns and villages where electronic payments are less popular.