Nearly a third (32 per cent) of credit card transactions and 46 per cent of debit card transactions made in the UK in August 2019 were made using contactless cards according to latest figures from UK Finance.
The data shows that consumers spent £223m a day on contactless cards in August, totalling £6.9bn during the month. In total there were 726m contactless payments in the month, a rise of 88m, a 13.7 per cent increase from 638m in the same month a year earlier. The figures also show that 82% of credit and debit cards issued in August were contactless, up on the 77% seen in the same month last year.
There were 1.5 billion transactions on UK cardholders’ debit cards in August 2019, 9.3 per cent more than in August 2018. This reflected a total spend of £51.4 billion, 2.7 per cent more than in the same period in 2018. There were 290 million transactions on UK cardholders’ credit cards in August 2019, 3.8 per cent more than in August 2018. This reflected a total spend of £16.3 billion, similar to the same period a year earlier.
The annual growth rate of outstanding balances on credit cards stood at 3.6 per cent in August 2019, continuing the downward trend from its recent peak of 8.3 per cent at the start of 2018 and showing that consumers are managing their finances effectively overall.
There were 1.7 billion debit and credit card transactions in the UK in August 2019, 7.7 per cent more than a year ago. This reflected a total spend of £63.1 billion, 3.8 per cent more than in the same period in 2018.
In total there were 726 million contactless card transactions in the UK in August 2019, a 13.7 per cent increase from 638m in the same month a year earlier. This data includes transactions on both UK-issued cards and cards issued overseas. The total value of contactless transactions was £6.9 bn in the UK in August 2019, a 15.7 per cent increase from £6.0 billion in the same month in 2018. This data includes transactions on both UK-issued cards and cards issued overseas.
John Crossley, Director of Money at comparethemarket.com, commenting on UK Finance Card Spending Update said“ Contactless debit cards have been the norm for a while, and now an ever-increasing number of people are tapping through transactions on their credit card. Today’s data shows contactless credit card spending accounted for nearly a third of transactions, suggesting people are increasingly using this type of finance to manage everyday living costs. Our research found that just over a fifth of young people say that they depend on a credit card to pay their bills – and similar numbers use credit to cover the cost of everyday living to make ends meet.
“With the festive season fast approaching – and Black Friday and Cyber Monday around the corner – it’s important to consider how you manage your borrowing. Providing consumers engage responsibly with debt and keep an eye on outgoings, using a credit card with a 0% APR offer can be a useful way to spread costs. However, these deals typically only last for a fixed time before higher interest rates kick in, so it’s worth checking with your current provider when this period comes to an end. Shopping around online and switching credit cards regularly is a one way for consumers to routinely enjoy perks such as 0% APR introductory offers.”
Dave Harris, CEO at equity release lender more2life, said “While the annual growth rate of credit card debt has slowed, the reality is that some consumers are still turning to unsecured forms of borrowing to help make ends meet. In particular, an increasing number of older consumers are using their credit cards to make up the shortfall between their expenditure and income.”
UK Finance card spending figures cover the monthly value and volume of transactions across debit and credit cards, both in the UK, and of UK-issued cards across the world. This data also covers outstanding balances on credit cards, card issuance and contactless payments.