In a sign that electronic payments are firmly planted in the local payments ecosystem, Visa Europe has announced that the UK has become a “cash-second” nation after the network reported that point-of-sale spend on payment cards increased by 9.6% over the past year and that now more than £1 ($1.42) in every £3 ($4.26) spent in the country is on a Visa card.
Commenting on the announcement, Kevin Jenkins, MD, UK and Ireland, Visa Europe said,
“At this rate, cash will be seen as a peculiar way of paying for things in as little as five years’ time. Mobile payments will accelerate this change and we’ve invested in the infrastructure for it to take off.” Also discussing the recent Visa Europe acquisition by Visa Inc, Jenkins said, “A combined Visa will be better positioned to accelerate the next generation of payments in the UK. The deal will give consumers and financial institutions across the UK greater access to global scale, technologies, investment and resources.”
While the UK’s status of cash-second is not entirely surprising given the mature domestic payments ecosystem, according to Visa Europe, a major driver of this new status is due to contactless technology and in particular contactless cards. With this technology proliferating around the world, the UK could be just one of the first countries to be named cash-second cultures as consumers realize the benefits of NFC payments whether through mobile devices or traditional payments cards.
Overview by Tristan Hugo-Webb, Associate Director, Global Payments Advisory Service at Mercator Advisory Group
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