UK chancellor Rishi Sunak is set to announce a change in the contactless limit from £45 to £100 in his budget speech this week.
Industry body UK Finance is believed to have pitched the increase to the Treasury, where it is being seen as symbolic of Britain's ability to make its own rules following its split from the European Union.
The limit was only raised from £30 to £45 in April, partly in response to the Covid-19 pandemic, which has prompted a surge in tap and pay at the expense of cash.
In September, contactless accounted for 64% of all debit card transactions and 46% of credit card transactions, according to UK Finance.
The Financial Conduct Authority announced in January that it was conducting a consultation on a possible lift in the contactless limit. "It’s important that payments regulation keeps pace with consumer and merchant expectations," noted the FCA. "Recognising changing behaviour in how people pay, as part of a wider consultation, we will shortly be seeking views on amending our rules to allow for a possible increase in the contactless limit to £100."
Sky News is reporting that some major banks have sounded the alarm bell over the proposed new ceiling, preferring a more cautious staggered increase to curb the risk of fraud.
Starling Bank for one has floated the idea of giving customers an opt-out mechanism from within the app.
With the potential for fraud risk rising, industry observers expect more attention to focus on the use of QR codes as an alternative to tap-and-go transactions and an upsurge in bometrically-secured limit-busting mobile contactless transactions.
Contactless payments first arrived in the UK in 2007, with a £10 ceiling which has been gradually increased over the last decade.