Citizens can now use technology to pay for £100 of goods and services
Credit: Cosmix from Pixabay
The government will more than double the contactless payment limit as part of plans in the Budget to help retail businesses recover from the coronavirus pandemic.
Chancellor Rishi Sunak told MPs that he is raising the limit from £45 to £100 as shops prepare to reopen their doors from next month.
Speaking earlier this week, Sunak said the move would “make it easier than ever before for people to pay for their shopping, providing a welcome boost to retail that will protect jobs and drive growth”.
Eight out of ten UK adults used contact payments last year, according to Treasury figures, while the percentage of debit card payments made using the contactless function has increased from 40% to 60% since the beginning of the pandemic.
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The change legally came into effect yesterday. However, businesses will take time to adapt payment systems.
The Treasury expects the banking system to introduce the £100 limit later this year.
The limit for contactless payments was increased from £30 to £45 in March 2020. This increase had already been planned, but was expedited as a result of the coronavirus pandemic.
Under plans laid out in the government’s roadmap for lifting lockdown measures, non-essential retail in England is set to reopen on April 12.
Elsewhere in the budget, Sunak announced that the furlough scheme for people temporarily out of work will be extended until the end of September, while the Self-Employment Income Support Scheme will be expanded to include those who were previously unable to apply due only recently becoming self-employed.
The Chancellor also said that high-street businesses will be able to apply for “restart” grants of up to £18,000 as part of a £5bn package for helping the economy reopen in the spring.