Contactless card payments have, in a relatively short space of time, become the favourite payment choice of the masses in many countries. However, that isn’t to say cash still doesn’t have its supporters and physical currency still holds an integral place in the global economic system today.

But given the huge amount of financial data that is available in the digital age, we have greater insight than ever before into the usage of both cash and contactless - so what do the numbers tell us? Are we heading towards a fully cashless society soon? Or will cash still be here for decades to come?

Let’s take a look…

Contactless card payment statistics

In most developed countries, contactless card payments are becoming a favoured way customers choose to spend in person. In the UK, 91.2% of eligible card payments were made via contactless technology in 2022, according to data from Barclays Bank, with more than a quarter of all payments of any kind being made contactlessly in 2021, according to data from UK Finance, which is a 12% increase on the previous year.

These numbers are a clear indication that contactless card payments are still on the rise which, in turn, directly impacts the number of cash payments being made as people instead opt for the digital alternative.

But the UK isn’t the only country in this part of the world that’s experiencing a contactless boom. Norway, for example, has seemingly fully embraced the technology, with 86% of all payments made at physical terminals being done so contactlessly in 2022, according to data from Norges Bank.

Heading further West, we see the same story unfolding. The United States - a country with a much higher population than both the UK and Norway - saw contactless payments jump to over 20 billion total contactless transactions in 2022, according to data from Statista. Add to this the fact that at least 51% of Americans use contactless cards, according to Financialholdings.com, there’s a clear trend emerging for contactless technology in developed countries.

But if there is any country that is displaying the influence and widespread adoption of contactless card payments more than any other, it’s China. In 2022, China saw a gargantuan usage of contactless cards, totalling more than 80 billion payments, according to the same data as earlier from Statista - that’s over four times that of the closest rival, the United States.
However, not all the data suggests contactless payments are making the global takeover they seem to be. Japan, for example, is not home to as many contactless payments as would be expected, according to the same data above from Statista. In 2022, Japanese citizens only made a mere 2 billion contactless payments - one-fortieth of the highest contactless spenders, China.

At face value, you may assume population numbers could play a part in Japan’s lack of contactless payments, but that’s not the case either. At 127 million (approximately), Japan has roughly double the population of the United Kingdom, meaning you’d expect them to be making double the number of contactless payments. But the UK sits firmly above Japan on the contactless payment scale, with UK citizens making over 5 billion contactless card payments in 2022. Considering Japan is regarded as one of the more technologically advanced and technologically forward-thinking countries in the world, these numbers come as a shock. But given Japan’s rich cultural history and devotion to tradition, it’s very possible many Japanese people still prefer to use physical cash rather than digital transactions, which could explain the figures.

Cash statistics

Not coming as a surprise, cash payments as a whole have been on the decline in most countries where contactless payments have been embraced. In the UK, cash payments accounted for just 15% of all payments in 2021, according to data from UK Finance. That’s in comparison to a decade prior, where cash accounted for roughly 60% of all payments, according to the Bank of England. Putting the numbers side by side, we can see a direct correlation between the rise of contactless payments and the decline of physical cash.

To make things even more worrying for fans of cash, the same data as above from UK finance predicts cash usage in the UK will fall to a measly 6%, while contactless card payments will continue to skyrocket. Having said that, UK Finance makes it clear that they do not expect the UK to become a fully cashless society:

“We expect cash usage to continue to fall and by 2031 cash will account for six per cent of all payments made in the UK. Rather than the UK becoming a cash-free society over the next decade, the UK will transition to an economy where cash is less important than it once was but remains valued and preferred by many.”

However, if we focus less on individual countries and look at cash usage on a larger scale, there are indications cash is far from defeated. In fact, cash still accounted for 59% of all point-of-sale transactions in Europe in 2022, according to a report from the European Central Bank. In the same breath, though, it’s important to note the same report outlines a sharp decline in the usage of cash, with cash payments falling by a considerable 13% between 2019 and 2022.

Cash is not finished, but the importance of contactless payments cannot be understated

With £4.6 billion worth of bank notes still in circulation in the UK, according to the Bank of England, it’s clear cash still has a huge part to play in society. But the popularity and quickfire rise of contactless payments, as outlined in the statistics above and countless others, tell us that in the near future, cash may be firmly positioned as a secondary alternative while digital payments become the overwhelming favourite.

If your business is yet to join the contactless revolution, consider utilising contactless card machines in your business to offer your customers the speed and convenience they’ve come to expect in their daily retail experiences.