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Contactless payments 'will outstrip cash by 2025'

The Co-operative says that contactless payments will overtake cash transactions by 2025. Credit: PA

Contactless payments via mobile phones will outstrip cash within next 10 years, The Co-operative supermarket said.

Currently, shoppers use cash for almost two-thirds (65%) of all transactions but contactless payments have trebled in a year.

With the launch of Apple Pay and other payment technology, the supermarket predicts that 65% of all transactions will be made by mobile phone by 2025.

It says bank cards and cash will become "a thing of the past like cheque books".

We've seen incredible growth in contactless and it is the payment medium of tomorrow, although mobiles are ringing the changes.

The new technology is perfect for convenience stores as shoppers buy fewer items and speed is important to them.

Cash is still king as people enjoy carrying money, however we predict that by 2025 mobile payments will overtake cards and cash.

– Cheryl Marshall, retail chief information officer at The Co-operative Food

However, a survey by the supermarket of 2,000 shoppers found they still tended to use chip and pin rather than contactless for payments over £10.

Trust was the main barrier when making a more expensive purchase, and the ease of contactless "loses its appeal as soon as the spend gets into double figures in consumers' minds", the retailer's report found.

The average contactless spending on a basket in convenience stores is £8.66 compared with £18.16 when using chip and pin.

The demise of cash has been predicted for a long time but it remains the currency option the general public turns to for confidence, convenience and security.

Cash is still the most prominent payment method for UK consumers and global demand for coins is as strong as ever.

– Spokesman for the Royal Min