The latest market report from trade association UK Finance shows how new technology, payment innovation and changing consumer habits contributed to 13.2 billion card payments at the end of 2017 overtaking cash payments (13.1 billion) for the first time.

This beats previous forecasts by one year for when debit cards were expected to overtake cash.

In total, across both debit and credit cards, the number of contactless payments increased by 97% during 2017 to 5.6 billion. In comparison, cash payments were down 15% year-on-year.

By the end of 2017 there were nearly 119 million contactless cards in circulation and, with customers and businesses increasingly choosing to use contactless cards and card acceptance devices, it is anticipated 36% of all payments across the UK will be contactless in 2027.

The number of cash payments in the UK is correspondingly expected to continue to fall over the next decade. There are expected to be 6.4 billion cash payments in the UK in 2027, accounting for 16% of all payments.

Despite this fall, cash will remain the second most frequently used payment method in the UK in 2027.

Stephen Jones, chief executive, UK Finance says: "We’re far from becoming a cash-free society and despite the UK transforming to an economy where cash is less important than it once was, it will remain a payment method that continues to be valued and preferred by many.

“These trends are likely to shift further over the next decade. Developments such as Open Banking are expected to bring extensive changes to the payments landscape, something that will likely shape how we interact with our money in the coming years.”