Contactless payments will account for almost half of all transactions by the end of 2022 (47%) while cash transactions will do so for just over a tenth, according to new research.
A report commissioned by VoucherCodes.co.uk called Life after Covid: Prospects for online retailing, physical stores and how we pay, was carried out by the Centre of Retail Research (CRR), examined the pandemic’s effect on the way UK shoppers pay for goods with some fascinating results.
The study shows that pre-pandemic in 2020, chip and pin was the most popular payment method, accounting for over a third (37%) of all transactions in the UK. During the same period, only 17% of all payments made were contactless. However, between 2021-2022, chip & pin payments are forecast to decline to just 25% of all purchases and cash payments will see a sharp decline, accounting for just over a tenth (11%) of all payments by the end of 2022.
The switch, which will constitute a 30% increase in contactless payments from pre-pandemic to the end of 2022, was accelerated by changing consumer and retailer behaviour when it comes to paying for goods during Covid-19. Shoppers swapped cash for card for hygiene reasons, many retailers also stopped accepting cash altogether, and the contactless payment limit increased from £30 to £45.
Looking ahead to next year, card payments are expected to account for almost three quarters (72%) of all transactions.