Why are Banks Ignoring the Scrapped £100 Contactless Limit?
The Financial Conduct Authority (FCA) announced that the £100 (US$133) contactless limit in the UK will be lifted in March, allowing banks with “strong fraud controls” to decide their own limits.
Since the lift, which happened on 19 March, some of the biggest UK high street banks have decided not to lift the cap.
Contactless payments are one of the most popular methods of payment.
Recent research from Barclays found that in 2024, 94.6% of eligible in-store transactions were contactless.
David Geale, Executive Director of Payments and Digital Finance at the FCA, says: “Contactless is people’s favoured way to pay. We want to make sure our rules provide flexibility for the future, and choice for both firms and consumers.”
Apple Pay and Google Pay already have a higher contactless limit, suggesting digital wallets have less restrictive control on consumer spending.
“The way we pay is no longer one-size-fits-all,” says Michael Ault, Managing Director at myPOS.
Research from the company pointed out that only 14% of Brits are still using cash as a primary payment method, with 38% of consumer below 34 using mobile phones to pay.
The lift of the contactless limit by the FCA signals the shift towards an easier method of payment for consumers as the regulator says the decision is meant to help financial institutions respond to “changing consumer demands, inflation and new technology”.
Banks such as Barclays, HSBC, Lloyds, NatWest, Santander, Monzo and Nationwide are keeping the contactless limit, according to the Guardian.
It also reports that Starling and Revolut have not made a decision.
Peter Harmston, Partner at KPMG UK, says : “The direction of travel is clear: payments need to keep pace with how people want to pay, without compromising trust.”
The lift takes place in March 2026 and comes after an announcement in December 2025 as a result of public discussion and consultation around contactless payments.
Nicole Olbe, Managing Director UKI, Adyen, says: “The FCA’s decision to lift the £100 contactless limit reflects how much the way we pay has changed in recent years.
“Contactless has become the default for many everyday purchases, with shoppers increasingly comfortable tapping their card for everything from groceries and fuel to eating out.
“For consumers, the change simply aligns physical cards with modern payment habits. Mobile wallets have enabled higher-value contactless payments for some time, and removing the cap ensures a consistent experience across all payment methods.
“For businesses, particularly high-volume retailers, removing the cap can help reduce friction at the till and streamline queues during peak periods.
“More broadly, it signals a continued shift towards faster, more seamless payment experiences.”
The cap was dropped in support of growth alongside the vision to make paying more convenient for consumers. It is just one of roughly 50 measures outlined in a letter to the Prime Minister by the regulator to prioritise digital solutions and support economic growth.
Nicole continues: “At the same time, advances in fraud detection mean payments today can be assessed with greater precision than through a fixed limit alone.
“As payment infrastructure continues to evolve, we’re likely to see contactless play an even bigger role in everyday spending, particularly as the FCA is empowering banks and consumers to set their own limits."
The FCA also notes that existing consumer protections will not change, and consumers must be reimbursed in unauthorised fraud cases, such as in cases of theft or loss.
