A closer look at payment statistics
Tips / 20.10.2021
If numbers are not your strong point, don’t worry you are not alone! Nevertheless, numbers (and statistics, in particular) play a very important part of our lives. We can’t escape them no matter what sphere of life we’re in. Whether to make payments, to keep track of cash flow, analysing developments, profits and loss, income and expenditure, etc. they help with many things. These include economic forecasting, regression analysis, decision making, planning and so much more. To get a glimpse at some of the key and most recent UK payments statistics, keep reading below!
According to the UK Finance report, “UK Payment Markets 2021” published in June 2021, the Covid-19 pandemic affected payments throughout the UK since its outbreak. As a result, payment volumes in the UK declined by 11% to 35.6 billion in 2020. The report indicates that although there was an overall decline in card payments in 2022, their share of payments rose with about 52% of all payments made in 2020 being made with cards.
Despite this, individuals started making more use of alternative forms of payment to cash, including using contactless, online and mobile payment channels. In addition, of the total 35.6 billion in payments made in the UK, consumers were those responsible for most of the payments. In fact, nearly nine out of 10 of all payments in this category were made by consumers. What’s more is that 81% of payments made by consumers were spontaneous payments, while 19% were made related to regular bills and commitments.
The debit card space in the UK is another interesting area to look at, with 44% of all payments made in the UK being made by such cards. It is interesting to note that 98% of the population now have a debit card and this is used to make daily card payments via a card machine. The situation is slightly different for credit cards as 69% of adults in the UK have this type of card, with 2.8 billion payments made using a credit card. This represents an 18% decline on the previous year.
Contactless payments in 2020 in the UK increased by 12% to 9.6 billion payments. The end of 2020 recorded the fact that there were 135 million contactless cards in circulation; around 88% of debit cards and 81% of credit cards having the contactless functionality. In addition to the above, over one-quarter of all payments in the UK were made using contactless methods.
With regard to the use of cash, cash payments continued to show a decline and fell by 35% to 6.1 billion payments. However, cash was the second most often used payment method after debit cards and cash was used for around 17% of all payments.
From the above, it is clear that Covid-19 accelerated some existing payment trends with the increased adoption of contactless cards and a decline in cash payments in the UK. Although cash is likely to remain an important payment method in the future, its use and perceived safety is likely to come into question as consumers now prefer contactless methods – whether by debit or credit card – to make safer and more hygienic payments.