Why Rishi Sunak could face UK public backlash over new contactless payment limit
Fraud fears over contactless bank card technology
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Rishi Sunak will roll out a new contactless payment limit next week. But his plans could prove controversial, as polls suggest Brits don’t want to see the limit increased. Some have blasted the move for going against consumers’ wishes, while others are concerned it could lead to a spike in fraud.
From October 15, the contactless payment limit will be raised from £45 to £100.
Chancellor Rishi Sunak decided to increase the limit from £30 to £45 in April 2020, in a bid to help the public go cashless during the pandemic.
But according to a poll by the Sunday Times, it seems the new limit of £100 is unwanted by most people.
The poll found that the majority of those surveyed wanted the limit to remain as it is – £50 or below.
The survey found that 45 percent wanted a contactless limit between £0 and £50.
Nineteen percent wanted to see an increase to the current limit, raising it to between £51 and £75.
Just 37 percent were in favour of Mr Sunak’s new £100 limit.
It’s not just the public who believe a new limit is unnecessary.
The banking trade body, UK Finance, has also expressed its doubts over the plans.
UK Finance informed the Financial Conduct Authority when consultations for the new limit were held in February that the public thought the current limit was fine.
UK Finance said only 20 percent of customers believed the original £30 limit was too low and 62 percent said £45 was about right.
UK Finance said: “There is no significant demand from consumers, including both contactless and non-users of contactless, to increase the single value limit above £45.
“Contactless users are content with a more conservative single value limit, indicating that £45 is more than sufficient for their basket size at present.”
Contactless card usage may have surged during the pandemic but the amount spent remains low.
The average transaction value made using contactless debit cards in June was just £37.44, well below the current limit.
Many are concerned the new higher cap could lead to a rise in fraud.
Although the amount you can spend without a pin will be capped at £300, this is still a staggering sum to lose.
Contactless cards may make transactions faster and easier but the lack of security means criminals could quickly spend up to £300 before facing a security check.
But consumer watchdog Which? has said contactless fraud rates remain very low.
It said the money stolen through contactless fraud was equivalent to less than 2p in every £100 spent in early 2020.
This is lower than 2018 levels, which was 2.7p, and represents just 2.8 percent of overall card fraud.
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