Contactless payments 'will outstrip cash by 2025'

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".

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.