Question 1

What are contactless payments?

Accepted Answer

A contactless payment (also known as a tap-and-go payment) is a payment that is facilitated by radio frequency identification (RFID) and near-field communication (NFC) technology. Essentially, the payment terminal creates a small field in the air around itself that can read the information on your card, triggering the payment without you having to make contact by putting the card into the machine or typing in your PIN.

Question 2

When did contactless payments start in the UK?

Accepted Answer

The first contactless card payments started in the UK in 2007. Back then, the limit was set to £10. It was introduced as a fast and simple way to pay for small items and an alternative to carrying around pocket change. In 2010, this was raised to £15 and then to £20 in 2012. The pandemic caused a surge in demand for contactless payment to support health and hygiene initiatives, increasing from around 160 million transactions in January of 2016 to over 169,162 million by October 2021.

Question 3

What is the limit for contactless payments?

Accepted Answer

As of October 2021, the contactless payment limit for the UK has increased from £45 to £100 with no daily or monthly limit. These limits are set by HM Treasury and the Financial Conduct Authority. There were two main reasons for increasing this limit: general cost of living increases and increased consumer demand for contactless as a safe and viable alternative to cash payments.

Question 4

How long do contactless payments take to process?

Accepted Answer

The time it takes to process these payments depends on the companies processing them and the configuration of the payment terminal or device. In general, they take 2-4 days and sometimes much less. However, as a consumer making the transaction, they are essentially instant.

Question 5

Why are contactless payments so popular in the UK?

Accepted Answer

For many years now, UK consumers have been part of the global trend of moving away from cash and on to digital payments. Contactless is especially popular because transactions can be completed in as little as 15 seconds with no need to handle cash and calculate change. This is also beneficial to merchants because staff can be moved off tills and redeployed elsewhere. Contactless payments are safer than cash for customers and businesses, and the additional security offered by contactless payment systems makes them much more secure than magnetic strip cards as customers are protected from unauthorised large purchases. Finally, contactless payments can also help businesses improve customer service by making payments quick and efficient, as well as helping fundraising teams by making it easy for people to make quick tap-and-go donations.

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