UK contactless cards reforms go live: Industry reaction

The aim, says the FCA, is to make it easier for consumers to pay using contactless. The FCA has described the existing rules as ‘red tape’ and has congratulated itself on its drive to allow greater flexibility for contactless payments, notwithstanding an apparent lack of demand from consumers for the existing £100 limit to be amended.
The regulator is however at pains to stress that any card issuer that amends the existing card limit will need to communicate the changes clearly to their customers.  Payments sector reaction, predictably, is generally positive with one notable and eloquent exception.

Azimkhon Askarov, Co-CEO & Partner, CONCRYT

While the removal of the £100 contactless limit is a positive development for consumer convenience, it also introduces new challenges in fraud prevention and customer protection. With shoppers already increasingly using and trusting tap-to-pay, this move will facilitate larger everyday purchases like weekly groceries or family meals being made via contactless payments. This is a landmark moment that will bring physical cards in line with digital wallets, where no such restrictions apply.

Unfortunately, higher transaction values will inevitably attract fraudsters, and globally, we’ve seen those higher contactless limits correlate with increased fraud attempts, particularly in regions like Europe and North America. It’s critical that banks, merchants and providers alike all balance this transition with robust measures such as advanced fraud detection and prevention measures, real-time transaction monitoring, and behavioural analytics to mitigate risks. By staying proactive, businesses can maximise the value of contactless transactions while minimising risks for consumers.

Diane Brocklebank, Executive Director, Payments Innovation Forum

From Thursday, banks can set their own contactless limits – and for many consumers, they’ll notice no difference at all. But that doesn’t mean nothing has changed.

What’s shifted is where the risk sits. The £100 cap was a blunt tool, yes, but it was one that consumers understood. PIF raised concerns with the FCA back in October 2025 about what happens when that clarity disappears – particularly for people who don’t manage their finances through a banking app, or who wouldn’t necessarily detect a fraudulent transaction until real damage was done.

The FCA has been clear that it doesn’t expect PSPs to rush into raising limits, and we think that caution is well-placed. For firms serving vulnerable customers – people with lower digital confidence, or those without easy access to card controls – the practical reality is that higher limits may simply not be appropriate. The Consumer Duty means those firms can’t just flip a switch and move on.

What we want to see now is the payments sector treating this as a moment to invest seriously in fraud controls, not a green light to increase transaction values without the infrastructure to back it up. The reimbursement framework offers a safety net – but leaning on it too heavily risks making consumers complacent about their own exposure, which helps nobody.

We very much welcome the FCA considering different ways in which regulation can help to facilitate innovation in the payments industry, fostering economic growth and providing greater customer choice – and innovation in payments is something PIF firmly supports. But it has to work for everyone, not just those who are already confident and digitally connected.

Monica Eaton, Founder and CEO, Chargebacks911 and Fi911

At this point, contactless is simply how the UK pays. Giving providers more flexibility reflects a market that has grown up quickly and confidently. For consumers and businesses, faster checkout is now the baseline expectation.

What deserves more attention, though, is what happens after the tap. As authentication steps fall away at the point of sale, the work of proving a legitimate transaction often shifts further down the line. When something goes wrong, the quality of merchant data and transaction evidence becomes far more important than many businesses realise.

We are already seeing how frictionless payments can create more detailed and sometimes more contested disputes. That does not mean the model is flawed. It means the supporting infrastructure has to keep pace with how people actually pay today. Increasingly, AI and machine learning are helping merchants and issuers spot risk signals earlier, organise evidence more intelligently and respond to disputes with far greater precision.

As the FCA moves to give firms more flexibility on contactless limits, maintaining consumer trust will depend on clear safeguards and strong evidence trails. Merchants that treat transaction data as a priority now will be in a much stronger position as scrutiny around contactless continues to build.

Russel Luis E Fernandes, Product Manager – In Person Payments, payabl.

Allowing banks and card providers to set their own maximum contactless spend in place of the previous £100 limit is good for economic growth and customer convenience.  

With 41% of consumers preferring to use contactless in-store, removing the cap will help meet customer demand, removing the hassle of entering a PIN when paying for large sums or higher ticket items, delivering the same speed and efficiency people expect of smaller payments.  

Merchants also stand to benefit, being able to offer a seamless checkout experience, whatever the amount, boosting customer satisfaction and encouraging repeat custom.  

However, while there are clear benefits of changing the contactless limit, providers must ensure the right balance between convenience and security, as fraud continues to pose a serious problem for both merchants and consumers.  

payabl.’s Fraud in Europe report found a third (36%) of consumers said purchases using stolen payment details was the most common type of fraud they experienced in the past 12 months, while a quarter (26%) named cloned card fraud as the most common.  

Fraud prevention techniques have come on significantly since the original limit was set, but these findings underline the need to stay vigilant. As companies change their rules around the contactless limit, they must ensure they’re partnered with payment providers equipped with best-in-class anti-fraud technology, offering real-time fraud protection services that ensure convenience does not come at the expense of security.

Hannah Fitzsimons, CEO, Cashflows

Contactless payments are becoming increasingly aligned with the reality of modern commerce. The rule change is more than a technical update, it’s a decisive step toward a pro-growth framework that trusts providers and consumers to manage their own financial lives.

The past two decades have shown that every time the contactless limit has been raised – from the initial £10 in 2007 to the jump to £100 in 2021 – the predicted ‘crises’ or waves of fraud simply never materialised. Instead, each increase was met with seamless adoption and improved efficiency at the point of sale. We’ve seen no fallout in the past because the industry’s fraud controls are robust, and this time will be no different. This is a natural evolution of the technology.

As adoption continues to accelerate, maintaining consumer trust will be critical to long-term success. Confidence depends on clear safeguards, effective oversight and transparency around how limits are applied.

For UK SMEs, this change is about removing the final hurdles to frictionless trade. Whether it’s a larger weekly shop or a family dinner, speed and convenience are the lifeblood of the high street. By allowing banks to set their own maximums, we’re giving businesses the tools to thrive in a competitive market. We must embrace this progress, frictionless payments are no longer a luxury – they are the oxygen that allows our everyday economy to breathe.

Chris Jones, Managing Director, PSE Consulting

Life just got easier at the checkout – but don’t forget your PIN

From 19 March, the £100 contactless limit will disappear, but for most people paying with their phone nothing will change. Mobile wallets such as Apple Pay and Google Pay already allow higher value contactless payments, so the real difference will be when you use your physical card.”

For consumers, this is really about choice and convenience. Banks will now be able to decide what contactless limits make sense for their customers, rather than everyone being tied to a single national cap.

In practice, everyday spending habits probably will not shift dramatically. The average contactless transaction in the UK is still only around £16, and billions of taps happen every year.

Removing the limit does raise a question many consumers will have. What happens if someone steals your card?”

Contactless fraud today is relatively low, around 1.3p lost for every £100 spent**, but if a physical card falls into the wrong hands higher limits could mean more damage before the card is blocked. The good news is that issuers are still required to refund unauthorised transactions, and they typically have pretty robust fraud and risk tools to identify aberrant behaviour.

There is also a resilience angle that people often overlook. Payments do not just depend on banks. Merchants ultimately control whether contactless is accepted in their stores. If a retailer experiences a cyber incident or technical disruption they may temporarily switch off contactless payments. We saw a version of this during the recent cyber incident affecting Marks and Spencer, when payment options were adjusted while systems were being secured. In those situations consumers still need to fall back on chip and PIN, so it’s important for consumers to remember their PIN.

It’s also worth noting that while the UK is moving towards higher or more flexible contactless limits, most countries still require PIN authentication for higher-value payments. Consumers will need to remind themselves of their PIN when picking up their passport.

As contactless limits become more flexible, banks should make it quick and easy for customers to view or reset their PIN in their banking app, and occasionally remind people of where they can find their PIN during emergencies, or when travelling abroad.

The new rules will make paying slightly smoother at the checkout. But the humble PIN still plays an important role in keeping payments secure, and it is worth making sure you remember yours.

Silvija Krupena, Director of the Financial Intelligence Unit, RedCompass Labs

FCA contactless changes risk “confusion without value”

What is this actually solving? Most everyday contactless spending in the UK already sits well below £100, and for higher-value payments, millions of consumers already use Apple Pay and Google Pay. The convenience gap has effectively been closed.

Meanwhile, the majority of respondents to the FCA’s consultation opposed lifting the limit, and several major banks have already indicated they will keep the £100 cap in place.

So rather than addressing a clear problem, this approach risks creating new ones. Different banks will set different limits, communicate them inconsistently, and leave consumers navigating a more fragmented system. At the same time, chargeback complexity increases and the potential loss per transaction rises if a card is lost or stolen.

The FCA’s own analysis points to as much as £31.3m in additional contactless fraud annually — a 131% increase.

Ultimately, this change risks introducing confusion without delivering meaningful value. And confusion is exactly what fraud thrives on.

Jean-Philippe Niedergang, Acting Group CEO & EMEA-Pacific-LATAM CEO, Castles Technology

The FCA’s move to allow banks and payment providers to set their own contactless limits marks an important shift in how payments are managed in the UK. As outlined in the FCA’s announcement on greater flexibility in setting future contactless limits, the industry is moving away from fixed caps towards a more flexible, risk-based approach.

For years, fixed caps have been used as a simple safeguard, but advances in fraud detection and authentication mean the industry is now better equipped to manage risk in more intelligent ways.

For consumers, the change should make everyday payments faster and more convenient, particularly as contactless continues to dominate at the checkout. But it also signals a broader transition towards more flexible, technology-driven payments ecosystems.

For retailers and payment providers, this flexibility will place greater emphasis on the infrastructure behind the transaction. Smart payment terminals and secure acceptance technology will play an increasingly important role in enabling seamless high-value contactless payments while maintaining strong security standards.

Ultimately, the shift away from a one-size-fits-all limit reflects how far the payments landscape has evolved. The next phase of contactless growth will be driven not just by convenience, but by the industry’s ability to combine speed, flexibility and robust security.

Deep Patel, Partner & UK Payments Lead, Capco

FCA contactless reforms create opportunities for advanced firms, but less sophisticated providers may hold back

The FCA’s move to remove the £100 cap on contactless payments and give firms greater control over limits is a natural evolution in payments, and one that is likely to be welcomed by card issuers.

However, consumer demand for higher limits remains relatively low, with ongoing nervousness around the potential for increased fraud. The FCA has been clear that any higher limits should apply only to low-risk transactions, placing the responsibility on payment service providers to deploy appropriate risk monitoring technology.

For issuers and PSPs with more advanced payments platforms, this creates a clear opportunity to differentiate. Firms will be able to tailor contactless limits to specific customer groups who are more likely to benefit from higher thresholds, such as corporate card users and high-net-worth individuals.

Over time, this also opens up opportunities to deliver additional value by learning from customer spending behaviour, including the potential to offer adjacent services such as financing.

But, adoption is unlikely to be consistent across the market. With mobile-based contactless payments already supporting higher limits through strong customer authentication, less sophisticated providers are more likely to retain lower card-based limits and increase them gradually in line with competitors and wider economic factors such as inflation.

Ultimately, while the regulatory change enables greater flexibility, the extent to which firms capitalise on the opportunity will depend on their ability to combine effective risk monitoring with more tailored customer propositions.

Paul Tutton, Product Manager for Payments and APIs, Moneyhub

The change to consumer set contactless limits is the natural evolution in frictionless payments, but not every bank will be ready from the outset.  

With different providers moving at different speeds, people will increasingly need a clear view of which cards have which limits and how their spending stacks up across all of them to avoid any confusion. That’s where open banking becomes important. Consumers need a practical tool that gives them a consolidated, real-time picture of their finances. 

The providers best placed to offer higher limits with confidence will be the ones with the most sophisticated fraud controls, and the most accurately categorised transaction data. Having nudges in place to flag spending alerts or affordability prompts when limits are raised, and the ability to flag unusual activity instantly will be crucial. When a bank can see what was spent, where, when, and whether it fits a customer’s normal behaviour, the difference between a typical transaction and a suspicious one becomes far clearer. 

That’s what good data transparency delivers, fewer false positives, less friction for genuine speed and fraud detection that works with real-time data and not just thresholds. Banks that invest in data categorisation and transparency will build the kind of trust that turns a regulatory change into a genuine competitive advantage.

Dean Wallace, Director of Consumer Payments Modernisation, ACI Worldwide

The decision to remove the UK’s contactless spending cap shows how quickly “tap to pay” has become second nature for consumers. What started as a way to speed up small purchases is now how many people expect to pay for almost everything. Mobile wallet adoption alone has grown from just 3.3% of UK consumers in 2013 to 45.8% in 2023, highlighting how quickly contactless behaviours have become mainstream.

Lifting the limit clearly improves convenience, but it isn’t without challenges. Consumers who use multiple banks or card products may face different rules depending on who issued the card, and there will be understandable questions around security when higher-value payments no longer require a PIN. That said, the most secure form of contactless payment already exists in the form of mobile wallets, which use biometrics for authentication.

For banks and merchants, the opportunity goes beyond higher limits. The real prize is in delivering a seamless digital experience, backed by strong fraud controls and real-time authorisation. It will also be interesting to see whether this shift accelerates mobile wallet usage or contactless cards, and whether it opens the door to wider adoption of Pay by Bank at the point of sale. With no contactless limit, paying directly from a bank account can feel just as frictionless, and with lower fees it’s attractive for merchants—though consumers may still weigh that against the reduced protections that come with payments that are effectively “as good as cash” in the UK.