UK Digital Payments reach new high as trends shift

The UK payments market continued its shift towards digital and mobile channels in 2025, with consumers making almost 50 billion payments as mobile wallets and account-to-account transactions gained further ground.

UK Digital Payments reach new high as trends shift

A total of 49.7 billion payments were made during the year, excluding CHAPS, up 2% as the market returned to more measured growth following several years of disruption, according to UK Finance‘s latest UK Payment Markets 2026 report.

Cards remain firmly at the centre of the market. Debit and credit cards accounted for 64% of all UK payments, with debit cards alone responsible for 26.6 billion transactions, or more than half of the total.

However, beneath those headline figures, the way consumers use cards is continuing to change rapidly.

Mobile Wallets Move into the Mainstream

Around 37.6 million UK adults, equivalent to 65% of the adult population, were registered to use a mobile wallet such as Apple Pay or Google Pay during 2025, compared with 57% in 2024.

Adoption is also translating into regular use. Among consumers registered for mobile payments, 89% used the service at least monthly and 79% at least weekly. Across the adult population as a whole, 58% were regular mobile-payment users.

Usage is particularly high among younger consumers. Some 87% of 16-24 year-olds and 89% of 25-34 year-olds were registered for mobile payments in 2025, compared with 60% among 55-64 year-olds and 29% of people aged 65 and above.

Debit cards dominate within those wallets, with around nine in ten registered users setting a debit card as their default Apple Pay or Google Pay payment method.

The figures suggest mobile wallets are increasingly becoming the interface through which consumers access established payment rails rather than replacing those rails themselves.

UK Finance notes that growth in mobile contactless transactions is likely largely to shift payments away from physical contactless cards rather than create an equivalent increase in overall card payments.

Contactless Growth Begins to Mature

Contactless payments nevertheless remain ubiquitous. UK consumers made 19.2 billion contactless debit and credit card payments during 2025, up from 18.9 billion a year earlier.

That represents 39% of all UK payments, compared with just 3% a decade ago.

But after years of rapid expansion, contactless growth is beginning to level out as adoption approaches saturation. UK Finance expects the next phase of growth increasingly to come through smartphones, smartwatches and other digital devices rather than greater adoption of contactless itself.

The distinction is becoming increasingly blurred because mobile wallets still rely heavily on the existing card infrastructure. Apple Pay and Google Pay also extend cards beyond the physical point of sale, with online retailers and apps increasingly allowing consumers to use stored wallet credentials at checkout.

Account-to-Account Payments Gain Ground

Cards are not the only beneficiary of Britain’s increasingly digital payment habits.

Faster Payments and other remote banking transactions reached 6.2 billion in 2025, making them the UK’s second most widely used payment method behind debit cards.

Remote banking has effectively become universal, with 91% of UK adults using at least one form during the year and 75% using mobile banking.

The continued expansion of account-to-account payments could become one of the most important competitive dynamics in UK payments over the next decade, particularly as Open Banking develops and Variable Recurring Payments become more widely available.

UK Finance forecasts Faster Payments and other remote banking transactions will rise to 8.4 billion by 2035, accounting for 16% of UK payments.

Cash Declines, But Isn’t Disappearing

The growth of digital channels continues to come partly at the expense of cash.

Cash payments fell to 3.9 billion transactions in 2025, representing just 8% of all payments, although UK Finance stresses that cash remains important for consumers who rely on it for budgeting, accessibility or personal preference.

Some 49.3 million people still used a cash machine during the year, illustrating the continuing demand for access even as transaction volumes decline.

By 2035, UK Finance expects cash to account for around 2 billion transactions, or 4% of payments.

Cards, meanwhile, are forecast to retain their dominance. Debit card transactions are expected to reach 29.5 billion, while debit and credit cards combined are projected to account for 65% of all UK payments.

The bigger transformation may therefore be less about cards disappearing than about cards becoming increasingly invisible.

As mobile wallets, embedded checkout experiences and account-to-account services expand, consumers are increasingly interacting with digital interfaces rather than consciously selecting the underlying payment infrastructure — a shift that is likely to define the next phase of the UK’s payments market.