# Why contactless has changed the face of payments in the UK Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2021-10-18 Category: BANKING Category URL: https://financedigest.com/category/banking Meta Title: UK Contactless Payments Surge: Limit Set to Rise to £100 Meta Description: Learn about the surge in contactless payments in the UK during the pandemic, the increase in limits, and the convenience it offers for customers and businesses. URL: https://financedigest.com/why-contactless-has-changed-the-face-of-payments-in-the-ukhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/storyblocks-happy-customer-paying-for-spa-treatmentsrwiaxj-t5f-1736837550858-compressed.jpg) _By_ **_Ralf Gladis,_** _CEO,_ [_Computop_](http://www.computop.com) Contactless payments have been experiencing a steep rise over the period of the pandemic in the UK. According to [data](https://www.chargedretail.co.uk/2021/01/22/90-of-card-payments-were-contactless-in-2020/) revealed by Barclaycard earlier in the year, this method of payment accounted for nearly 90 per cent of all face-to-face card transactions in 2020, not just driven by hygiene concerns, but by the increase in the contactless limit to £45.  Now, the limit is set to be lifted again, this time to £100, from October 15. The move, which followed a public consultation with retailers and banks, promises to give customers even more flexibility when making their purchases. It’s hardly surprising that [consumers have adopted](https://www.financedigest.com/sales-of-disposable-plastic-blood-bag-market-to-be-significantly-influenced-by-rising-consumer-adoption.html "Sales of Disposable Plastic Blood Bag Market to be Significantly Influenced by Rising Consumer Adoption") the ‘tap and go’ option in the UK. This method takes two or three seconds to complete, while a [card payment](https://www.financedigest.com/fingerprints-supports-two-more-biometric-payment-card-launches-in-the-mena-region.html "FINGERPRINTS’ SUPPORTS TWO MORE BIOMETRIC PAYMENT CARD LAUNCHES IN THE MENA REGION") made using a PIN can take up to 29 seconds, and even a cash payment will take 22 seconds. According to [figures](https://www.ukfinance.org.uk/press/press-releases/contactless-now-accounts-more-quarter-all-uk-payments) from UK Finance, the body that represents banks, no age group or region in the UK falls below 75 per cent usage of contactless. But it’s the all-round convenience of tap and go that most appeals. Take travel for example. Previously customers wanting to take a bus, a train, or the Underground had to work out the fare they [needed and buy](https://www.financedigest.com/weighing-up-buy-now-pay-later-what-you-need-to-know-before-you-invest.html "Weighing up Buy Now, Pay Later: What you need to know before you invest") the ticket at a machine, from a vendor, or from the driver (in the case of buses) before they boarded. Now, all they need to do is hold their Near-Field-Communication (NFC)-enabled credit or [debit card](https://www.financedigest.com/visa-has-terminated-global-debit-card-agreements-with-ftx.html "Visa has terminated global debit card agreements with FTX") up to a checking reader when getting on and off whatever transport mode they are using. This automatically allocates the best fare and automates [payment of the journey](https://www.financedigest.com/russias-national-payments-system-the-journey-so-far.html "RUSSIA’S NATIONAL PAYMENTS SYSTEM: THE JOURNEY SO FAR"). The system works just as easily with a [mobile phone](https://www.financedigest.com/mobile-phone-insurance-brand-loveitcoverit-launches-in-ireland.html "Mobile phone insurance brand, loveitcoverit, launches in Ireland") or smartwatch, provided a card is stored. As well as making the process quick and easy for the customer, it also reinforces [data protection](https://www.financedigest.com/modern-data-protection-how-organisations-can-protect-against-cyber-attacks.html "Modern Data Protection: How organisations can protect against cyber attacks") because both the beginning and end of the journey are transmitted anonymously. Recently [news](https://www.bbc.co.uk/news/technology-58719891) stories have focused on research that indicated unauthorised payments could be made on iPhones if people were using Apple Pay with Visa cards at public transport ticket barriers. Of course, in laboratory conditions, scientists found a [way to trick the system](https://www.financedigest.com/virtual-assistance-to-pave-the-way-for-europe-urethral-bulking-systems-market.html "Virtual assistance to pave the way for Europe Urethral Bulking Systems Market"), but a fraudster would need a POS terminal, and that would require a stringent series of legal contracts all of which would demand his or her identification. The risks are negligible. **Understanding the process** As more and more [customers choose to use contactless methods of paying](https://www.financedigest.com/shell-energy-to-pay-for-overcharging-price-cap-customers-ofgem.html "Shell Energy to pay for overcharging price cap customers -Ofgem"), it is important to understand that the process goes through a sophisticated series of steps: - When contact is made with the customer’s chosen [card or device, the system checks in the background whether the stored card is valid](https://www.financedigest.com/fime-empowers-issuers-with-unionpay-card-personalization-validation-testing-services.html "FIME empowers issuers with UnionPay card personalization validation testing services"). If they are using transport, a back-end system will assess any journeys they take during the [course of one day](https://www.financedigest.com/britain-on-course-for-hottest-day-on-record.html "Britain on course for hottest day on record") and calculate the best price. - The amount of the purchase is transmitted to the [Payment Service](https://www.financedigest.com/igtbs-payments-services-hub-faq.html "iGTB’s Payments Services Hub – FAQ") Provider (PSP), which is the interface between the retailer, transport or service provider and its bank, often referred to as an acquirer. The PSP makes sure that the [cards accepted by the service provider are connected to the payment system](https://www.financedigest.com/fingerprints-and-tag-systems-collaborate-to-offer-contactless-biometric-payment-cards-globally.html "Fingerprints™ and Tag Systems collaborate to offer contactless biometric payment cards globally") and transmits the payment amount to the acquirer. - The [bank of the retailer](https://www.financedigest.com/uk-retail-banks-is-irrelevance-curtailing-opportunity.html "UK Retail Banks: Is Irrelevance Curtailing Opportunity?"), transport or service provider transmits the payment to the customer’s bank, the so-called issuer. - The issuer authorises the [payment and the amount is debited from the customer’s](https://www.financedigest.com/2019-year-customers-take-control-payments.html "2019: The year customers take control of payments") account. **Tap and go, without the tap** Looking ahead, [customers might not even need](https://www.financedigest.com/why-empathy-needs-to-sit-at-the-heart-of-bbls-and-cbils-customer-service.html "Why empathy needs to sit at the heart of BBLS and CBILS customer service") to tap a reader. Tests are being conducted to use Bluetooth for [contactless payment](https://www.financedigest.com/curating-a-fully-contactless-customer-experience-for-payments.html "Curating A Fully Contactless Customer Experience for Payments ") on public transport. This would require passengers to [open the app](https://www.financedigest.com/yolt-becomes-first-money-app-to-complete-the-integration-of-all-new-users-via-an-open-banking-api.html "Yolt becomes first money app to complete the integration of all new users via an Open Banking API") of the transport provider. When they board the bus or train, a connection is established between the passenger’s terminal device and the Bluetooth transmitter on the vehicle. At the same time, trials of [cards that use integrated fingerprint](https://www.financedigest.com/fingerprint-cards-ab-signs-partnership-gemalto-secures-worlds-first-volume-order-fingerprint-sensors-dual-interface-payment-cards.html "Fingerprint Cards AB signs partnership with Gemalto and secures the world’s first volume order of fingerprint sensors for dual-interface payment cards") readers are also ongoing. These allow consumers to authorise payments with a touch of their finger on a sensor, in much the same [way that smartphone security works](https://www.financedigest.com/five-ways-to-keep-your-head-above-water-while-working-from-home.html "Five ways to keep your head above water while working from home").  If these tests are successful, we can expect even simpler connections between contactless [payment](https://www.financedigest.com/the-future-of-contactless-payments.html "The future of contactless payments") procedures and a host of circumstances where contactless payment currently requires tapping a terminal. Contactless brings additional bonuses in some sectors. Retailers have the option for customers to make contactless payment through a proprietary app which also gives them the opportunity to launch [loyalty programmes or offer digital](https://www.financedigest.com/the-evolution-of-loyalty-and-its-place-in-the-digital-age.html "THE EVOLUTION OF LOYALTY AND ITS PLACE IN THE DIGITAL AGE") coupons as part of the tool. All [retailers](https://www.financedigest.com/cracking-the-code-of-customers-future-value-in-retail.html "Cracking the code of customers’ future value in retail") are looking for ways to expand their customer databases so they can accurately target and personalise interactions with customers, but the consumer benefits too. By accessing an app, they can manage a variety of different processes, from [payment through to redeeming loyalty points or receiving special offers using one tool on their mobile](https://www.financedigest.com/what-is-the-optimum-mobile-payment-mix.html "What is the optimum mobile payment mix?"). The UK has been widely accepting of contactless payments, and consumers are [reaping the benefits](https://www.financedigest.com/can-finance-reap-the-benefits-of-the-cloud-without-compromise.html "Can finance reap the benefits of the cloud without compromise?") of easier and more convenient processes when paying for goods, particularly since the limit is now being raised to £100. The [technology behind](https://www.financedigest.com/what-is-generative-ai-the-technology-behind-openais-chatgpt.html "What is Generative AI, the technology behind OpenAI’s ChatGPT?") contactless is constantly developing and as biometrics are gradually incorporated into debit and credit cards, we will see more secure and even more convenient options emerging. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---