As of October 15, 2021, Britons have been able to spend up to £100 through their cards or phones without having to enter their PIN. The move comes after the successful rise in the limit from £30 to £45 in April 2020, which came about as a response to the COVID-19 pandemic. In recent years, contactless payments have became increasingly popular.
Furthermore, Nerdwallet’s Consumer Borrowing Index found that two in 10 admitted to spending with less thought since the limit rose to £100.
Over a quarter of Generation Z and just under a third of millennials noted that they had been overspending since the limit went up on contactless payments.
Denise Ko Genovese, a senior personal finance expert at Nerdwallet, believes the rise in the payment threshold means the public will need to be more aware of their spending habits.
Ms Genovese explained: “Keeping tabs on your cards has never been more important.
“Although contactless has always posed a risk when it comes to card loss or theft, now that the limit has risen to £100 we advise that consumers get to grips with their banking facilities and know how to block or report their card should they suspect any fraudulent activity.
“For those worried about the impact of the increase on their spending habits, many banking providers now offer the option to adjust the contactless limit, so people can better manage their budgets before heading to the checkout.
“With the purchasing experience already reduced to a simple tap, the increased limit makes it even easier to rack up your spending.
“As we approach the seasonal sales, you should get smart with your budget as it is even more important to ensure you are spending within your means.”
Despite the concerns of many, contactless payments have become one of the most popular ways of making transactions.
David Postings, the Chief Executive of UK Finance, said: “The new £100 limit offers customers greater choice about how they pay for things like their weekly shop or a tank of fuel.
“Contactless payments have become increasingly popular, and the payments industry has worked hard to ensure retailers are able to offer customers the new higher limit.”
From January to July of 2021, some 60 percent of all payments made from credit or debit cards in the UK were made using contactless.
At the time of the contactless limit’s increase, UK Finance warned of the sheer number of terminals that need to be updated.
Therefore, the £100 limit may still not be available across all retailers despite the approval by banks and businesses up and down the country.
Despite the overwhelming move to paying for goods and services using the contactless method, anyone concerned about the recent limit rise can still use their PIN to make payments in the majority of retailers.