Debit cards, encompassing those stored on mobile devices, were the primary method of payment in the UK last year, according to the annual UK Payments Market report. These cards accounted for 54% of all transactions in 2023, with contactless payments making up 39% of that total.
Cheques, which were once slated for phase-out by 2018, have dwindled to just 0.2% of all payments, with 77 million written last year. Despite the increasing prevalence of digital transactions, cash is not expected to disappear entirely. Forecasts by UK Finance predict that notes and coins, used in 8% of all payments last year (3.9 billion transactions), will halve to 4% by 2035, representing approximately two billion transactions.
The report highlights that a significant portion of the population still prefers using cash. "Rather than the UK becoming a cash-free society over the next decade, the UK will transition to an economy where cash is less important than it once was but remains widely valued and still preferred by some," the report stated.
This preference is reflected in the continued use of ATMs, with nearly 50 million people withdrawing cash last year. Nick Quin from Link, which manages the UK's ATM network, noted that while cash withdrawals are declining nationwide due to the convenience of contactless cards and digital wallets, millions still depend on cash daily. "People on lower incomes rely more heavily or entirely on cash to budget, which is why our job is to protect access to cash for as long as people need it," Quin added.
Data also indicates that nine in 10 users of mobile wallets have their debit card set as the default payment method, underscoring the integration of cards into digital payment systems.