A significant change in the payment process at checkout counters for shopping is set to take effect this week. The current contactless card payment limit of £100 will be removed starting March 19, allowing banks to establish their own limits. If transactions exceed the current limit, customers are typically required to enter a four-digit PIN for authorization.
Under the new rules, effective March 19, the £100 contactless limit will be eliminated, giving banks the flexibility to set their own limits. Customers will also have the option to set their personal contactless limit. Many card issuers already permit customers to adjust their contactless limit or deactivate the feature entirely.
The contactless limit has seen increments over the years, starting at £10 in 2007, then increasing to £15 in 2010, £20 in 2012, £30 in 2015, £45 in 2020, and finally reaching £100 in 2021. The decision to remove the contactless limit was announced by the Financial Conduct Authority (FCA) last year following a consultation process.
The FCA estimates that 85% of UK residents make monthly contactless payments and acknowledges the advancements in fraud prevention systems. David Geale, the FCA’s executive director of payments and digital finance, emphasized the importance of flexibility in rules for both businesses and consumers.
Kate Nicholls, chairwoman of UKHospitality, praised the change as beneficial for consumers and businesses, particularly in the hospitality and retail sectors. Jana Mackintosh, managing director of payments and innovation at UK Finance, welcomed the FCA’s decision to grant banks and payment providers more flexibility in setting contactless limits, ensuring robust security and fraud controls remain in place for future changes.