Brits will be able to make contactless payments of up to £100 from 15 October, UK Finance has confirmed.
The rise, from £45, was trailed by chancellor Rishi Sunak in his budget speech in March after industry lobbying and an FCA consultation.
The limit was only raised from £30 to £45 in April 2020, partly in response to the Covid-19 pandemic, which has prompted a surge in tap and pay at the expense of cash.
In June, UK Finance published figures that show that during 2020 the number of contactless payments made in the country increased by 12% to 9.6 billion payments, with the pandemic driving a mass-market switch away from physical cash.
Overall, contactless payments accounted for more than a quarter of all UK payments, while cash transactions fell by 35%.
Says Sunak: “Increasing the contactless limit will make it easier than ever to pay safely and securely - whether that’s at the local shops, or your favourite pub and restaurant. As people get back to the high street, millions of payments will made be simpler, providing a welcome boost for retailers and shoppers.”
At the time of the budget, there were reports that some major banks 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 floated the idea of giving customers an opt-out mechanism from within the app.
Luke Massie, CEO of VibePay says that while the move to increase the limit "makes complete sense", the size of the rise means that "consumers will see a rise in 'card not present' fraud".