Record proportion of contactless payments made in August

The number of contactless debit card payments reached their highest level in August, accounting for 62% of all debit card transactions, new data published by UK Finance has revealed.

The banking body’s figures also showed that 45% of all credit card transactions were contactless, with the number of transactions in August increasing by 14.6% compared to the previous month.

However, the annual growth rate of outstanding balances on credit cards contracted again in August, dropping by 12.6%, as consumer repayments continued to outstrip new lending.

Uk Finance revealed that overall volume of debit and credit card spending in the UK fell slightly in August, with 1.3% fewer transactions than in July, and 27.7% fewer than in August 2019.

This accounted for 1.2 billion debit and credit card transactions in the UK in August, a total 1.3% fewer than the previous month, and 27.7% fewer than in August last year. The total spend of £51.6bn was 3.8% less than July, and 14% less than last August, UK Finance confirmed.

However, the banking body suggested the value of transactions made by UK debit cardholders had remained “strong”, with total spending on debit cards amounting to £58.4bn – a figure 1.2% below the record total value seen last month, but 12.5% higher than August last year.

“As lockdown restrictions continued to be eased in August, we saw record numbers of customers choosing to make contactless payments using debit cards,” commented UK Finance managing director of personal finance, Eric Leenders. “Contactless card transactions using either debit or credit cards also increased compared to July, suggesting that consumers are taking advantage of the £45 contactless spending limit.

“Meanwhile, the amount of spending on UK debit cards fell slightly in August following a record high in July but remained strong at £58.4bn.

“The percentage of credit card balances attracting interest and the annual growth rate of outstanding balances on credit cards continued to decline – the latter dropping by 12.6 per cent over the twelve months to August.”

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