NEW LIMITS: The FCA has proposed higher limits for contactless payments (Image: Getty)
Shoppers could soon be able to make larger contactless payments. Currently, people are limited to £100 per tap when using a physical contactless card.
The Financial Conduct Authority (FCA) intends to revise these rules next year, giving banks and payment providers with robust security systems the ability to set their own thresholds. Changes will take effect from March 19, with each company deciding if and when to implement new limits.
The FCA emphasises that any organisation adjusting limits must clearly notify customers about the updates. The aim is to allow firms to respond more effectively to consumer demand, inflationary pressures, and advances in payment technology.
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Companies will also be encouraged to let customers set personal limits or turn off contactless features altogether, options already offered by several high street banks. Contactless usage has soared in recent years, with the spending cap gradually increased in stages reports Neil Shaw on Bristol Live.
Barclays data shows that 94.6% of eligible in-store card transactions were contactless in 2024. The bank also reports that last year’s monthly tap-and-go transactions were 10 times higher than in 2015, reflecting growing adoption across the UK.
Currently, the £100 limit is complemented by a combined ceiling of £300 or a maximum of five consecutive contactless payments before strong customer authentication is required. The FCA’s revisions would also allow firms to reassess cumulative spending caps if they choose.
The regulator believes that offering more flexibility will motivate firms to improve fraud controls, giving consumers stronger protection. Existing safeguards remain in place, ensuring customers are reimbursed for unauthorised transactions, including lost or stolen cards.
This update forms part of roughly 50 FCA initiatives shared with Prime Minister Sir Keir Starmer in January, aimed at supporting economic growth. The public consultation on the proposals concluded on October 15, with the feedback influencing the final approach.
David Geale, FCA executive director for payments and digital finance, said: “Contactless is people’s favoured way to pay. We want to make sure our rules provide flexibility for the future, and choice for both firms and consumers.”
Kate Nicholls, of UKHospitality, welcomed the move, saying: “Making life easier for consumers is a positive for any hospitality and high street business, and I’m pleased the FCA is bringing forward this change. Contactless has increasingly become the preferred payment method of choice for many people, and lifting the limit can mean quicker and easier experiences for consumers.”
Jana Mackintosh, head of payments and innovation at UK Finance, added: “We welcome the FCA’s move to give banks and payment providers greater flexibility over contactless limits in the future. Contactless is a very popular and secure way to pay.”
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