A new research from Mintel has revealed that contactless payments have overtaken cheque books in 2016. According to the research, cheques have been used by less than one third (31%) of British people in the past three months, down from 40% who used them to make a payment in 2015. Following the news, Ross Macmillan who is the Head of Research and Intelligence at allpay Ltd., comments:
“After a slow start, contactless has taken off in the UK and across Europe.
Initially the market was slow in its adoption, punctuated by initial security scares and a chicken & egg scenario between banks and retailers, but activity is ramping up considerably.
According to research consultancy, RBR, there were 223 million contactless cards in issue in Europe in 2014 which represented 15% of all payment cards. Its forecast suggests the number will treble between 2014 and 2020 to just short of 700 million cards, representing more than 40% of the total regional card base.1
Issuers see contactless as a way of encouraging consumers to reduce their dependency on cash, cut transaction times and increase spend, and often issue replacement cards with contactless functionality. While some mainstream banks and challenger banks have been quick to seize the opportunity and customer demand, others have been slower to react – a position they can ill afford to take.
In January 2016, the average contactless transaction in the UK was just over eight pounds – an amount that would have previously been paid in cash. And with the contactless limit now at £30 – this channel shift is likely to accelerate.
Mobile payments could ultimately impact growth in future years but with contactless cards, issuers have an uncomplicated and proven route to market which customers are already enjoying and using.
As an approved MasterCard and Visa card manufacturer – we’re seeing upwards of 90% of new orders requiring contactless functionality and with both of the card schemes mandating contactless capability on new terminals in 2016, the level of acceptance is set to soar.”