Starting today, a significant shift in payment methods at the checkout counter during shopping is being implemented. The previous £100 contactless card payment limit has been removed, giving banks the authority to set their own limits. This change applies to both debit and credit cards.
Previously, if a purchase exceeded £100, the customer had to input their four-digit PIN for authorization. Furthermore, if multiple contactless transactions under £100 added up to over £300 in a day, the PIN entry was required.
As of today, the removal of the £100 limit provides banks with increased flexibility to establish their own rules. Customers now have the option to set their personal contactless limits as well.
Various card providers already offer the ability for customers to adjust their contactless limits or deactivate the feature. The contactless limit has evolved over the years, starting at £10 in 2007 and gradually increasing to £100 in 2021.
The decision to eliminate the contactless limit was announced by the Financial Conduct Authority (FCA) last year after thorough consultation. The FCA highlighted that a vast majority of UK residents engage in monthly contactless transactions and emphasized the enhancement of fraud prevention mechanisms.
Industry experts, including David Geale from the FCA, and Kate Nicholls from UKHospitality, have expressed positivity towards the change, noting the convenience it brings to consumers and businesses. Jana Mackintosh from UK Finance also welcomed the move, emphasizing the popularity and security of contactless payments.
Major banking institutions like NatWest, Santander, Lloyds, Barclays, Nationwide, TSB, and Monzo have provided insights into their current stance on contactless limits, with most maintaining the £100 limit for now. Customers are offered flexibility to adjust their limits through respective banking apps.
While discussions on potential limit changes are ongoing, the focus remains on maintaining robust security measures. Customers are encouraged to stay updated on any adjustments through official channels.