Millions of consumers are set to experience significant alterations in contactless payment card limits following recent announcements by the financial regulator.
Currently capped at £100, the contactless limit necessitates entering a four-digit PIN for transactions exceeding this amount. However, the Financial Conduct Authority (FCA) has disclosed that starting March 19, 2026, banks and payment providers will have the authority to establish their individual limits.
Moreover, businesses are being urged to empower customers to set their own limits or deactivate contactless functionality altogether. Many card issuers already permit clients to adjust their personal contactless cap or disable the feature entirely.
As per existing regulations, multiple contactless payments under £100 can typically be made in a day. Nevertheless, entering a PIN may be required if these transactions accumulate to over £300.
With the regulatory amendment, firms will have the flexibility to consider revising this policy at their discretion. Initially introduced in a letter to the Prime Minister in January, the FCA’s proposals underwent a consultation phase until mid-October.
The evolution of contactless limits has seen a progression from £10 in 2007 to £15 in 2010, £20 in 2012, £30 in 2015, £45 in 2020, and finally £100 in 2021.
The FCA estimates that 85% of UK residents engage in monthly contactless card transactions. David Geale, the FCA’s executive director of payments and digital finance, emphasized the importance of adapting rules to accommodate evolving preferences in payment methods.
Kate Nicholls, chairwoman of UKHospitality, lauded the regulatory change for simplifying transactions for consumers, benefiting businesses in the hospitality and retail sectors.
Jana Mackintosh, managing director of payments and innovation at UK Finance, welcomed the FCA’s decision to grant greater flexibility to banks and payment providers regarding contactless limits in the future. While immediate changes to the £100 limit are not anticipated, any future adjustments will prioritize stringent security and fraud prevention measures.
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