Contactless payments on the up
More and more cards transactions are being made by contactless payments, according to the latest statistics on card spending from UK Finance.
The trade body reported that in total there were 726 million contactless card transactions in the UK in August 2019, a 13.7 per cent increase from 638 million in the same month a year earlier.
The total value of contactless transactions was £6.9bn in the UK in August, a 15.7 per cent increase from £6bn in the same month in 2018.
UK Finance also found that consumers spent more on debit cards in August 2019 than 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 £51.4bn, 2.7 per cent more than in the same period in 2018.
Credit card spending has increased over the past year too. 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 £16.3bn, 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.
John Crossley, director of money at Compare the Market, 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.”
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.”