Plastic fantastic set to oust cash

Card payments are set to overtake cash payments in the UK for the first time, a new study from Payments UK has found.

The research, released on Monday, showed cash is still the most popular payment method with 45% of all transactions being made with it.

But it also suggested card transactions will overtake the cold, hard folding in 2022, when 14.5 billion credit, debit and charge card transactions will be made, against 13 billion cash payments.

Just three years later, cards will account for more than half of all payments as a result of the increasing acceptance and popularity of contactless card payments.

The UK remains behind the times with card payments, with a number of countries already very fond of the plastic - in New Zealand, the EFTPOS debit card system is used for 60% of retail transactions since being introduced in 1985.

Payments UK also pointed to the dwindling popularity of the once-ubiquitous cheque, with 13% fewer written in 2015.

It wasn’t quite dead, however, with 546m cheques still being written during the year.

“Technology, consumer choices, business behaviour and market developments are major factors in how we choose to pay, and will have a major impact on how things change over the next ten years,” said Payments UK chief economist Adrian Buckle.

“Consumers and businesses [are] more ready than ever to reassess how they make payments and make the most of the convenient, cost effective and innovative options that are available.”