FCA Seeks Views on Removing the £100 Contactless Payments Limit

The Financial Conduct Authority (FCA) is exploring whether changes to the UK’s contactless payment limits could offer greater flexibility, enhance consumer protection, and support economic growth.

As part of a broader initiative to modernise financial regulations, the FCA is considering whether removing or increasing the current £100 contactless limit would be beneficial for both consumers and businesses. This move could facilitate smoother transactions, improve customer experience, and encourage innovation in fraud prevention and payment technologies.

The review aligns with the FCA’s commitment to fostering economic expansion, first outlined in a letter to the Prime Minister in January. Among the proposals is the potential for financial firms to set their own contactless limits—an approach already in place in the US—provided they have robust fraud controls in place. Any changes would be subject to the Consumer Duty, ensuring positive outcomes for customers.

David Geale, Executive Director of Payments and Digital Assets at the FCA, highlighted the potential impact of the review:

"Currently, 85% of people in the UK make contactless card payments each month. This is the perfect opportunity to explore whether we can improve and increase trust in the UK’s payments system. We’ve worked fast to progress this work, which is one of around 50 measures we put forward at the start of the year to help support economic growth across the UK and, in turn, improve lives."

Economic Secretary to the Treasury, Emma Reynolds, also welcomed the review:

"Every regulator has a part to play in the collective mission to drive growth through our Plan for Change, which puts more money into working people’s pockets. The FCA’s review of the contactless payment limits, including removing the £100 limit on individual payments, is a welcome step to ensure that families can safely benefit from more flexibility when making purchases."

Despite any potential changes, consumer protection remains a priority. Current regulations requiring firms to reimburse customers in cases of unauthorised payment fraud will remain in force.

The FCA is inviting feedback on its engagement paper, with responses due by Friday, 9 May 2025.

Read the press release here.