British banks will limit contactless payments across the region to 100 pounds ($137) starting Oct. 15, banking industry body UK Finance said on Friday (Aug. 27), according to a Reuters report.
The threshold for multiple contactless transactions before customers are required to enter their PINs will also rise from 130 pounds ($178.95) to 300 pounds (almost $413).
Contactless payments across Britain spiked during the COVID-19 pandemic, with many merchants turning away cash in an attempt to limit the virus’ ongoing spread.
In May, contactless payments represented 49 percent of credit card payments and 65 percent of debit card transactions across the country, according to UK Finance. Total transactions were doubled in May 2021 compared to one year earlier.
“Given the number of terminals that will need to be updated to accept the new limit, it will take some time to be introduced across all retailers,” UK Finance said in a statement.
Britain’s contactless payment limit had been boosted from 30 pounds ($41.30) to 45 pounds (about $62) in April 2020, about a month after the nation’s coronavirus lockdown began. The finance ministry and the Financial Conduct Authority decided to raise the limit to 100 pounds.
“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,” said Finance Minister Rishi Sunak.
According to Great Britain’s Office for National Statistics, there was a spike in grocery spending during the European Championship in June, but retail sales dropped sharply by 2.5 percent in July, as spending across supermarkets and among high-street retailers dipped sharply.
Almost every retail category saw a decrease in sales, including at petrol stations and non-food stores, where sales dipped by 2.9 percent and 4.4 percent, respectively. The decreased spending on fuel at petrol stations was due to heavy rainfall in early July, while consumers spent more on computers and telecoms.
The share of online cross-channel shoppers in the U.K. has grown by 14 percent since the pandemic’s onset, while the share of brick-and-mortar shoppers has dipped 11 percent in the same time, according to the PYMNTS/Cybersource Global Digital Shopping Index U.K. Edition released in January.