Worldpay View

Contactless overtakes Chip and Pin for in-store card payments

Our latest figures show that contactless transactions have now overtaken chip and pin payments for the first time, as consumers embrace more convenient forms of payment. Contactless usage jumped by 30%¹ in the past year to become the most popular form of card payment for in-store transactions.

5 Nov 2018

 

    This trend has continued into the second half of this year, with a consistent rise in contactless payments versus Chip and PIN. Earlier this month, research found that nearly half of all UK payments (including cash) were contactless enabled², demonstrating the nation’s drive for more convenient forms of paying.  

    We predict that during the final six months of 2018, UK shoppers could spend as much as £38.5billion³ via contactless transactions in-store. Part of this growth comes from the rise in use of mobile wallets such as Apple Pay, Samsung Pay and Google Pay, which have seen a staggering 114% increase on the high street over the same period.

    rocket

    Clothing and footwear contactless sales soar

    Fashion retailers have seen the greatest shift from Chip and PIN to contactless, with the sector citing a massive 415% year-on-year increase. Mobile contactless payments also rose significantly in the clothing and footwear sector, up almost 500% over the past year. Betting shops and department stores also saw significant growth of mobile contactless payments: between 150-250%.

    With the value of mobile contactless payments rising 122% over the past year¹, the added convenience and security of ‘limitless’ mobile contactless payments could pave the way for phones to replace wallets over the next decade. Our research has also found that 65% of consumers say they’d happily make a contactless purchase of up to £504.

    The trend towards tap-and-go has been witnessed nationwide, demonstrating that the desire for more frictionless and convenient purchasing experiences is being driven by an evolution in shopper behaviour.

    UK regions with the greatest contactless growth¹

    All contactless paymentsMobile contacless payments
    1. Northern Ireland – 48%1. Northern Ireland – 166%
    2. North West – 42%2. North West – 142%
    3. Scotland – 37%3. West Midlands – 125%
    4. North East – 37%4. Scotland – 122%
    5. Yorkshire & the Humber – 37%5. North East – 121%

     

    Steve Newton, Executive Vice President, Worldpay comments: “The data clearly shows that shoppers are moving towards more convenient forms of payment. This aligns to what we’re seeing in a number of sectors: time-poor consumers want instant access to their goods. Whether buying clothes or booking holidays, speed and ease are the watch words for meeting consumer expectations. The popularity of online shopping, mobile payments and click-and-collect is testament to this.

    “The rise of contactless is part of a bigger story: it’s not simply about tap and go – it’s about convenience and reducing the parts of the shopping experience that customers find irritating, like queuing and waiting to pay. Over 50% of shoppers we surveyed believe that their phones could replace their wallets within the next five years 4 – the phenomenal growth of mobile contactless is a leap along this path. With the added benefit of ‘limitless’ transactions and biometric security offered by mobile wallets, our smart phones could be the key to the next frontier of frictionless commerce.”

     

    About the data

    This data has been taken from the analysis of card transactions processed by Worldpay in the UK between January 2018 and July 2018 versus the previous year. Contactless transactions refers to a combination of mobile contactless and card present contactless. Mobile transactions refer to mobile contactless transactions only.

     

    1 Analysis of all card present transactions processed by Worldpay in the UK, June 2017 – June 2018.

    2 Mastercard Analysis, September 2018

    3 Data from Worldpay merchants in the UK only. Data adjusted to reflect estimated total UK-wide card transactions.

    4 Worldpay Consumer Behaviour and Payment Preferences Report 2017


    Written by:  

    Marcus Hall, CORPORATE COMMUNICATIONS & EVENTS MANAGER,  

    5 Nov 2018