People could find it easier to pay using contactless, thanks to greater flexibility and the removal of red tape by the FCA.
Banks and payment providers with strong fraud controls will be able to set their own limit for contactless payments, allowing them to better respond to changing consumer demands, inflation and new technology. They are also being encouraged to let customers set their own limit, or turn contactless off altogether, as many high street banks already do.
People are using contactless as the go-to way to pay. Research by Barclays[1] found that almost 95% of all eligible in-store card transactions were contactless in 2024.
Banks and payment providers must have strong fraud controls when processing contactless transactions. The greater flexibility will incentivise firms to step up their fraud prevention, giving consumers greater protection and peace of mind.
Crucially, existing consumer protections remain in place. Consumers must be reimbursed in unauthorised fraud cases, such as if their card is lost or stolen.
David Geale, executive director of payments and digital finance at the FCA, said:
'Contactless is people’s favoured way to pay. We want to make sure our rules provide flexibility for the future, and choice for both firms and consumers.'
Kate Nicholls, chair of UKHospitality, said:
'Making life easier for consumers is a positive for any hospitality and high street business, and I'm pleased the FCA is bringing forward this change.
'Contactless has increasingly become the preferred payment method of choice for many people and lifting the limit can mean quicker and easier experiences for consumers. While many people still prefer to use cash or chip and PIN, this change adds much-needed flexibility for providers and consumers.'
The new standards follow a public discussion and consultation around contactless payments, and how to make paying more convenient for consumers, while supporting growth. This work is one of around 50 measures that the regulator outlined in a letter to the Prime Minister[2] in January to support economic growth and prioritise digital solutions.
The rule changes take effect in March 2026, after which it will be up to firms if and when they take up the greater flexibility to change any contactless limits. Those that do, will need to communicate the changes clearly to their customers.
Notes to editors
- Read the Notice[3].
- In line with the Consumer Duty[4], firms will need to communicate any contactless limit changes to consumers.
- Based on industry feedback, the FCA understands that most banks and payment service providers are likely to maintain their existing contactless limits for the foreseeable future, even after the changes come in.
- The FCA enables a fair and thriving financial services market for the good of consumers and the economy. Find out more about the FCA[5].