"This year's survey reveals a significant decline in the use of credit cards, from 14.2% of transactions to 12.6%. With higher interest rates making credit cards a more expensive way to shop, consumers turned to debit cards where usage increased from 62.0% to 64.0% of transactions. As the cost of living crisis eased, some customers returned to old habits. The weekly shop showed signs of a comeback with consumers making fewer but larger transactions."
"While cash usage declined it still remains an important payment method for many customers, accounting for almost a fifth (19.2%) of all transactions, though the average transaction value was significantly smaller than other payment methods. Despite their declining popularity, for larger transactions, consumers preferred using credit cards which offer additional protections for shoppers. More shoppers were exploring less traditional payment methods than ever before, particularly for larger transactions. This included the use of gift vouchers, PayPal and Buy Now Pay Later."
Credit card use fell from 14.2% to 12.6% of transactions in 2024 while debit card use rose from 62.0% to 64.0%. Total transactions fell from 20.9 billion to 20.4 billion, and average transaction values increased across all payment types as customers made fewer but larger purchases. Cash accounted for 19.2% of transactions with significantly smaller average values. Consumers preferred credit cards for larger purchases because of additional protections. Usage of alternative payment methods such as gift vouchers, PayPal and Buy Now Pay Later increased, particularly for large transactions. Retailers paid £1.48 billion in card fees in 2024.
Read at London Business News | Londonlovesbusiness.com
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