New figures from UK Finance show that payment habits in the UK are evolving…
Research from UK Finance
New figures from UK Finance illustrate how payment habits in the UK have changed, with payments increasingly being made digitally.
They found that 57% of UK adults are now using mobile wallets, and that 75% use mobile banking. They found that debit cards were the most used payment method, and that 61% of all card payments were made via contactless.
They also found that UK adults’ use of Buy Now Pay Later had seen a significant increase, jumping from 14% to 25% in just one year.
UK Finance also reported that cash payments made up less that 10% of all payments, showing just how much we are now turning towards digital payment options.
Adrian Buckle, Head of Research at UK Finance, commented:
“These changes weren’t just driven by younger consumers. We saw growth in mobile wallets and Buy Now Pay Later across older age groups too, highlighting how digital payments are becoming more mainstream across the board.”
This shows that although younger generations may be the biggest users of digital payment options, they aren’t the only ones who are seeing the appeal…
What Next?
UK Finance have predicted that by 2034, cards remain the most popular way to pay, and that more people will register and use mobile wallets. They expect that traditional payment methods such as cash and cheques will further decline, with cash projected to fall to just 4% of payments.
The Government has stated that they it is “crucial” that seamless account-to-account options are developed, which would enable consumers to pay for goods and services in shops and online directly from their bank account, eliminating the need for a physical card.
They also commented that “there are multiple significant technological advances which could fundamentally alter the way that payments are made, processed and received.” These include the introduction of things like central bank digital currencies, crypto payments becoming a payment option, the rise of artificial intelligence, and more.
Cash Remains Important
The increasing popularity of digital payment options not to say that cash is becoming obsolete, as the Government have confirmed that they are committed to providing access to cash so that all individuals can pay for essential goods and services in a way that best suits them.
“As digital payment technologies continue to evolve, they could leave behind such groups of users, who may have different payment needs that are not currently being met.” – Payment Systems Regulator
According to FCA research, an estimated 3.9 million UK adults were digitally excluded in 2022, with an estimated 3.1 million being reliant on cash. Therefore, it is important that we continue to consider the needs of those who have limited digital access and skills.
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