Contactless spending increases 166% in 2016, Barclaycard reports

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Data released by Barclaycard today as part of its latest Contactless Spending Index shows that ‘touch and go’ payments have rocketed in the last 12 months, with year-on-year spending up 166%.

The news comes as industry body, the UK Cards Association (UKCA), reveals that the number of contactless credit and debits cards in the UK now tops 100 million. Demonstrating the increasing popularity of contactless – which jumped 164% in 2015 – separate research from Barclaycard also reveals that one in two (50%) of Brits now pay contactlessly at least once a month – with a fifth (21%) planning to increase their usage even further next year.

The national picture 

The biggest leaps in contactless spending have been seen in some of the UK’s largest cities. In Manchester, ‘touch and go’ transactions have increased more than anywhere else, with residents spending 325% more this year compared to last. Also seeing strong uplifts are: Glasgow (308%), Blackpool (296%), Hull (287%) and Edinburgh (267%).

Position City Annual spending increase
1 Manchester 325%
2 Glasgow 308%
3 Blackpool 296%
4 Hull 287%
5 Edinburgh 267%
6 Cardiff 266%
7 Liverpool 260%
8 Newcastle 257%
9 Birmingham 248%
10 Northampton 234

Overall, London continues to lead the way for contactless usage, with almost half (47%) of all eligible transactions (those up to £30) now made contactlessly – up from three in 10 in 2014.

Spending is expected to even grow further next year both in London and right across the UK, especially as the number of retailers offering contactless as a way to pay continues to increase. For instance, Sainsbury’s has recently rolled out contactless payments to its UK stores, meaning that a large rise in the supermarket sector is expected as shoppers take advantage of the faster and more convenient way to shop. 

Where’s Britain spending?

Amongst all retail categories, service stations have seen the highest rise in contactless usage, with the amount spent jumping 285%. Service stations now also have the highest average transaction value of all sectors at £13.32, with busy travellers enjoying the speed and ease of contactless to fill up on fuel or grab a bite to eat when on the move.

Position Category Annual spending increase
1 Service stations 285%
2 Discount stores 234%
3 Gift, card & novelty shops 180%
4 Department stores 170%
5 Supermarkets 156%
6 Postal services 121%
7 Pharmacies 108%
8 Convenience stores 98%
9 Household appliance stores 97%
10 Caterers 90%
11 Pubs and bars 79%
12 Fast food outlets 69%
13 Newsagents 63%
14 Restaurants 62%
15 Commuter transport 26

Pubs and bars are receiving a roaring trade with contactless climbing 79% in the last year – with technology such Barclaycard’s “Pay @ Pump” self-pouring beer pump which was piloted last week showing the demand for faster payments in the service industry.

The first of its kind, the self-pouring beer pump allows drinkers to pour their own pint of ale and pay with a touch of their contactless card or device in just 60 seconds and has been designed to help bars and pubs reduce queuing time for customers buying drinks during busy periods like Christmas.

Tami Hargreaves, commercial director, digital consumer payments at Barclaycard, said: “Brits across the UK are increasingly catching on to the speed and ease of ‘touch and go’ payments, meaning that for many, contactless is now the preferred way to pay. No longer is contactless just reserved for the morning coffee or afternoon snack, as our data shows, Brits are turning to these payments for all types of purchases, from a supermarket top-up shop to stocking up on everyday essentials in discount stores and pharmacies.

“In 2016, the increasing popularity of mobile payments and wearables has also contributed to the surge in contactless, and as more retailers continue to accept ‘touch and go’ as a way to pay we expect this upward trend to continue well into next year.”