UK boosts tap and go transaction limits

British finance leaders have once again raised the spending limit for contactless card payments following a public discussion with retail and banking leaders, according to Her Majesty's Treasury and the Financial Conduct Authority.

The new plan, which goes into effect Oct. 15, 2021, will enable British retailers to accept contactless transactions of up to £100 at the POS, UK government officials stated. This will be the second increase in two years, following the April 2020 decision to raise the contactless price limit from £30 to £45.

David Postings, chief executive at UK Finance, stated he has seen growing interest in touchless commerce. "The increase in the limit to £100 will allow people to pay for higher value transactions like their weekly shop or filling up their car with fuel," he said. "The payments industry has worked hard to put in place the infrastructure to enable retailers to update their payments systems so they can start to offer their customers this new higher limit."

Rishi Sunak, chancellor at Exchequer, agreed. "Increasing the contactless limit will make it easier than ever to pay safely and securely – whether that's at the local shops, or your [favorite] pub and restaurant," he said. "As people get back to the high street, millions of payments will made be simpler, providing a welcome boost for retailers and shoppers."

Expanded options, choice

UK Finance, which is managing the process for setting the industry contactless limit, noted the decision to raise the contactless limit was made in March 2021, when the Financial Conduct Authority (FCA) confirmed the threshold for multiple contactless transactions before a PIN is required will rise from £130 to £300, representatives stated.

Sheldon Mills, FCA executive director, consumers and competition, stated that contactless usage rose during the pandemic, making it necessary for the government to support the new ways in which consumers pay.

"Increasing the regulatory limits allows industry to raise the contactless limit in the future to meet the evolving expectations of customers and merchants for fast but secure ways to pay," Mills said. "When making any change, it is important that the industry continues to ensure the right protections are in place to keep payments safe and secure."

Device upgrades

British officials will continue to explore a range of payment methods in cooperation with public and private sectors, UK Finance stated, adding that it may take time for terminals to be updated to accept the higher contactless transaction limits. Representatives advised consumes to look for in-store signage or on device screens to confirm brick and mortar retailers can accept higher limit contactless transactions.

Matt Phillips, vice president, head of financial services at Diebold Nixdorf in the United Kingdom and Ireland, stated the increase emboldens the industry's commitment to consumer choice, which may include cash, card, wallet or contactless.

"It represents timely action from the industry after the pandemic heightened appetite for contactless, as customers desired safety and efficiency when shopping," Phillips said. "This move will widen the consumer usage of contactless payments while keeping a limit that protects their account. Any move that improves the service for customers, while enabling the digital evolution of the UK banking industry is a positive step, and a trend that we hope to see continue across the sector."

UK Finance representatives pointed out that consumers can spend more than £100 at the POS by using Chip & PIN and cash. In addition, mobile wallets have no spending limits when authenticated through biometric technologies like fingerprint or facial recognition, they noted.

Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.

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