The cards, of which there are 23 million in the UK, give customers a fast and easy-to-use alternative to cash when making low-value payments in participating stores, and at vending machines, festivals and other events. Contactless enables customers to pay simply by holding their card up to a reader for low value transactions rather than tapping in their PIN.

This is the second time the contactless transaction limit has been increased - it was first raised from £10 to £15 in 2010. Over 17.7 billion of all consumer cash payments are for amounts under £20 - with a majority of these being for purchasing groceries, followed by payments made for dining out. This latest rise will broaden the appeal of contactless, increasing the situations where using the technology is of benefit - for example, making it possible to pay for a small basket of shopping in a supermarket rather than just for sandwiches or coffees.

Although a contactless transaction doesn't normally require a PIN to be entered, usage is monitored by the chip on the card. The chip limits the number of consecutive contactless transactions that are allowed before the cardholder is required to undertake a chip and PIN transaction. This is designed to deter and limit fraudulent use should the card be lost or stolen.

However, should a fraudster successfully make a contactless transaction on a stolen card, customers have legal protection from any losses - just as they have with any type of card fraud.

Cards upgraded to give customers the option of making contactless payments carry the easily recognisable symbol (see Notes to Editors) and customers will be able to use their cards anywhere they see the acceptance symbol at home or abroad.

Contactless technology has been developed by the global card schemes - American Express, Mastercard and Visa - which means that UK customers will be able to use their contactless debit or credit credit card in any other country that has adopteed this technology.

Contactless can be used in 55 national retailers, which have rolled out the technology or else placed it in selected stores, including McDonalds, Boots, Greggs, Little Chef, Paypoint, Spar and Wilkinsons.

Cardholders who don't yet have contactless don't need to do anything. They will be contacted by their card company and given full details as they join the rollout. More information is available from either MasterCard paypass.com or Visa Europe visaeurope.com/aboutvisa/products/visacontactless.jsp 

Chair of The UK Cards Association Melanie Johnson said: "Low-value transactions have been gradually moving from cash to card. Contactless cards provide another convenient and fast method for paying for low-cost goods and services. They attract the same level of protection as traditional plastic cards - meaning that customers will suffer no loss if they are a victim of fraud - and certainly provide much more convenience and protection than traditional payment methods such as cash or cheque".

Mark Austin, Head of Contactless, Visa Europe said: "We welcome this increase which will make contactless payments even more useful to people across the country. Contactless technology has passed several major milestones in the last year, with HSBC recently announcing the rollout of Visa contactless debit cards. By the end of the year we will be approaching 30 million Visa cards in the UK, and with more major retailers coming on board on a regular basis, the opportunities to use contactless payments are increasing rapidly."

Marion King, President of MasterCard UK & Ireland, said: "As the first scheme to commercially roll out contactless payments with MasterCard PayPass on both cards and mobile phones in the UK, we welcome the increase in the transaction limit and expect it to drive usage. As we move to a world beyond cash, contactless will also be the foundation which allows consumers to turn their phones into wallets and enjoy smart, simple and safe payments through applications such as PayPass."

American Express UK said: "The rise in the payment limit is good news for consumers as it offers even greater flexibility and convenience for card holders. The evolution of this technology allows for faster transactions and will broaden the appeal of contactless cards to the growing number of people adopting this method of payment to pay for their everyday purchases."