Contactless limit could rise to £100

The limit on a single payment using contactless card technology could rise to £100 – more than double the current limit.

The coronavirus pandemic led to larger amounts spent via contactless payments on debit cards, credit cards, and cards connected to smartphones.

It has been less than a year since the limit was raised from £30 to £45.

The Financial Conduct Authority (FCA) said it will consult “shortly” on a change in the rules.

“It is important that payments regulation keeps pace with consumer and merchant expectations,” the regulator said.

“Recognising changing behaviour in how people pay, as part of a wider consultation, we will shortly be seeking views on amending our rules to allow for a possible increase in the contactless limit to £100.”

The FCA can set the boundaries for payments, under its rules, but the card issuers would have the power to set the actual limits.

The use of contactless technology by consumers has risen sharply in recent years, with more services adopting the technology and most shops offering it as an option.

To protect workers and consumers during the Covid outbreak, an increase to the current limit of £45 was rushed through by the regulator in April last year.

The latest figures show that the proportion of contactless payments had fallen slightly compared with pre-pandemic levels, because lockdown measures hit the use of pubs, restaurant, and public transport. They accounted for 41% of card transactions.

However, there was a 16% increase in the total value of contactless payments in the UK in October, compared with the same month a year earlier, the latest data from UK Finance – which represents banks – shows.

The amount spent on contactless hit a monthly record in August, boosted by the Eat Out to Help Out scheme and fewer coronavirus-related restrictions. A total of £8.4bn was spent on credit and debit cards using contactless during that month.

“The industry believes that a more flexible approach could be merited in future, which takes into account consumer demand, fraud prevention, security and convenience,” said a spokesman for UK Finance.

“Contactless is one of a range of payment methods and the industry will also continue to work closely with the regulator to ensure that customers can pay in a way that suits them.”

However, there may be less enthusiasm from some shopkeepers concerned about higher-value theft as a result of the proposed changes.

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