Cash or card: Why are cashless payments on the rise in the UK?
Date: 16/06/26
Cashless payments are rising in the UK, they are fast, convenient and increasingly built into everyday life, from tapping a card for a coffee to paying with a phone on the go.
Cashless payments are any transactions made without physical notes or coins, including debit and credit cards, mobile wallets, bank transfers and other digital payment methods.
For consumers, they can make paying quicker and easier. For businesses, they can help speed up the checkout process, reduce cash handling and support the way many customers now prefer to pay.
The trend of cashless payments in the UK
It’s clear where we are headed: digital payments now play a central role in how people in the UK spend.
As of 2024 39% of all payments in the UK were made via contactless methods and cash payments have been showing a long-term decline, and only accounts for 9% of all payments made in the UK.
The UK is becoming more digital in how it pays, but it is important to note that for many, cash still plays an important role.
What is driving the shift towards cashless payments?
One of the biggest drivers is convenience. Contactless cards, mobile wallets and digital banking tools make it easy to complete low-value purchases quickly, whether someone is shopping in-store, ordering online or paying on the move. Businesses have also adapted, with more card terminals, card only self-service checkouts and mobile card readers making digital payments easier to offer in places where cash was once dominant.
The change in customer expectations is another major factor. Many people now expect to be able to pay in the way that works for them, whether that is by card, phone or another digital method. Online shopping has reinforced this behaviour too. Once consumers become used to smooth digital checkout experiences, they often expect the same speed and flexibility in-store.
Why consumers are embracing cashless transactions
For many consumers, the appeal is simple: cashless payments fit with the changing modern life. Tapping a card or phone is often faster than finding coins or waiting for change, and digital payment methods can feel more convenient when people are juggling work, travel and everyday tasks. Mobile wallets have helped increase this even more by letting people keep payment methods on a device they already carry.
There is also a shift in behaviour. As more businesses accept digital payments as standard, people become more reliant on them. A third of adults were already making contactless payments through mobile wallets such as Apple Pay and Google Pay in 2023, showing that habits are moving away from cards alone. The more familiar contactless methods become, the more likely consumers will reach for them without thinking.
That said, convenience isn’t the only consideration. Some people still prefer cash for budgeting, privacy or peace of mind. For others, it is a backup in case of outages or technical issues. This is why the conversation is not just about whether cashless payments are growing, but how businesses can adapt without excluding those who still prefer cash.
Is the UK becoming a cashless society?
The short answer is: not completely…at least not yet.
The UK is clearly becoming less reliant on cash for everyday spending, but that is not the same as cash disappearing altogether. Cash is still the second most frequently used payment method in the UK, even as digital options continue to grow. And large parts of the UK remain within reach of free-to-use cash points for withdrawals and deposits.
As previously mentioned, cash is still important for budgeting, inclusion and resilience. Some customers prefer it, some communities depend on it more than others, and many businesses continue to accept it for practical reasons. In other words, the UK may be moving towards a more cash-light economy, but a fully cashless society is not here yet.
What businesses should take from the cashless payments trend
The rise of cashless payments is not just a payments story. It mirrors larger changes in customer behaviour, technology and expectations. For businesses, that means thinking about payments as part of the overall customer experience. The most effective approach will be to make paying simple, flexible and reliable, while understanding that not every customer wants to pay the same way.
As payment habits continue to change, keeping up with what customers value most, such as speed, choice and ease, can help businesses stay relevant.
Summary
Cashless payments are on the rise in the UK because they align with how many people now prefer to shop and pay: quickly, conveniently and across multiple channels. We can see that there is a strong shift towards contactless and card-based transactions, but cash still has a part to play.
For businesses, the key takeaway is not simply to go digital for the sake of it, but to understand how payment preferences are changing and respond in a way that supports customer experience and operational needs.
If you want to explore how payment options can support your business, find out more about the payment solutions available from Handepay.
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