While debit and credit cards continue to dominate as the preferred payment method, digital payment methods are rising in demand though cash still holds its place, a recent survey has shown, shedding light on evolving payment habits of Brits.
According to a nationwide survey SumUp, over half of people (62 per cent) say that they prefer to pay with debit or credit cards, highlighting the continued dominance of traditional card-based transactions.
In addition, 18 per cent of consumers find mobile payment options, such as Apple Pay and Google Pay to be the most convenient choice, reflecting the growing adoption of digital wallets. Furthermore, there are notable age-based differences that come with this method.
Among younger generations, mobile payments are popular, with more than a third (36 per cent) of those aged between 18 and 24 adopting mobile payment methods, alongside 28 per cent of people aged between 25 and 34.
Interestingly, only 11 per cent of people still favour paying in cash, highlighting the shift towards more streamlined and digital alternatives. Other emerging payment methods include Buy Now, Pay Later services (4 per cent), alongside more innovative methods such as cryptocurrency and wearable technology like smartwatches and payment rings (1 per cent).
The factors that have influenced changes in payment preferences over the past year
Over half (51per cent) of people said that they have changed the way they pay for goods and services over the past year. Among them, 22 per cent have embraced digital payment methods, with the increased convenience of this method being a key factor in their decision.
Additionally, 15 per cent of consumers have reduced their use of cash, largely due to merchants and transportation services adopting tap-to-pay, making physical cash less necessary. Meanwhile, 9 per cent have turned to Buy Now, Pay Later services, appreciating the flexibility of spreading payments over time and taking advantage of special offers from retailers through these services.
Furthermore, 4 per cent have started using subscription-based services for regular purchases such as groceries, pet food, or personal hygiene products, enjoying the ease of scheduled deliveries and fixed payment plans. These shifts all reflect the growing demands for convenience and flexibility in how consumers make purchases.
The survey further shows that businesses that don’t offer digital payment options can be a source of frustration for customers.
In fact, 19 per cent find it inconvenient when a business doesn’t accept digital payments or cards, while 11 per cent actively avoid such businesses, expecting all establishments to provide digital payment options as a standard.
Despite 8 per cent of consumers preferring to shop at cash-only businesses, an overwhelming three quarters (75 per cent) still consider cash as an option in certain situations. For 26 per cent, using cash provides a greater sense of control over their spending, whilst 22 per cent find it quicker and more convenient.
Additionally, 17 per cent of consumers simply prefer the tactile nature of cash transactions.
Furthermore, 22 per cent of people only use cash when they receive it as a gift, such as during Christmas or birthdays, highlighting how certain occasions still drive cash usage.
Other reasons for continued cash usage include the desire to avoid digital payment fees or charges (12 per cent), the lack of access to digital payment methods (12 per cent), and concerns over the security of digital transactions, of which 8 per cent of consumers expressed a mistrust.
Corin Camenisch, marketing & growth lead at SumUp, commented on the report, “We ran this survey to gain a deeper understanding of UK consumers’ ever-evolving payment preferences and to offer valuable guidance to SMEs, helping them to adapt to changing consumer behaviours and better meet their customer needs.
“While debit and credit cards continue to dominate as the preferred payment method, it’s clear that cash is slowly declining in use, particularly among younger generations.
"That said, cash still holds its place for many. Looking ahead, we can anticipate a rise in innovative payment methods like digital wallets, especially as younger consumers increasingly embrace the convenience and flexibility they offer.”