UK Consumer Payments in 2025: Digital Momentum Meets Persistent Habits

Jun 13

A new YouGov poll for The Payments Association, covering 2,069 adults nationwide, confirms a country edging further into tap-and-go territory without severing its last ties to notes and coins. The findings help explain why payments remains one of the UK’s few double-digit growth stories — and where the next leg of expansion is likely to come from.

Digital rails are extending their lead, yet cash and cards still anchor millions of everyday transactions, revealing a market in transition rather than a head-long rush to cashlessness.

Unlock the upside of the UK’s payments boom

If you’re a Payments or E-money fintech poised to scale, Lagom Consulting delivers end-to-end support—from data-driven GTM blueprints and in-market execution to board-level growth counsel, cross-border expansion and M&A orchestration.

1. Contactless is king, but not unchallenged

Contactless debit cards remain the single most popular method for day-to-day purchases (27%), with debit cards overall accounting for 45% of preferences.

Yet the headline masks demographic churn: mobile wallets are now the top choice for 30% of 18 to 24-year-olds and 38% of full-time students, versus just 8% of retirees.

2. Cash refuses to die

38% of adults still use cash at least weekly and almost two-thirds use it monthly. Reliance jumps to 72% among over-55s and 43% among lower-income C2DE consumers. Northern Ireland is a clear outlier, with weekly cash use at 54%.

For now, calls for a “cashless 2030” look premature.

3. Wearables: early-stage, but a steep curve

Wearable payments remain niche — 78% say they never use them — yet usage among 18-24s has climbed to 31% monthly (up from 24% in 2024) and hits 30% in London, double the national average.

As device prices fall and form factors improve, this channel is likely to move from curiosity to mainstream in the second half of the decade.

4. Security is the deal-breaker

When making large purchases, 54% of respondents put security ahead of convenience or rewards. The figure rises to 59% for women and 63% in Northern Ireland, but drops to 47% in London, where reward hunting is comparatively stronger.

The finding underscores why challenger propositions built on cashback alone rarely shift behaviour: trust trumps perks.

Fraud remains pervasive: 37% of adults report victimisation, led by credit-card (13%) and online-shopping scams (11%). Londoners face more than double the national rate of investment-scam exposure. Providers that can demonstrably reduce perceived risk stand to win share.

5. Online payments are routine — but unequal

A slim majority (52%) make at least one online payment a week; among 45- to 54-year-olds that rises to 58%.

Yet only 15% of 18-24s make multiple weekly online payments, suggesting their mobile-first lifestyle has yet to translate into heavier e-commerce spend. Class gaps persist too: 58% of ABC1 consumers pay online weekly versus 43 % of C2DEs.

6. Appetite for new methods inches up

The share of people open to adopting a new payment method has risen to 27% (from 21% a year earlier), but 55% remain unlikely.

Millennials and Gen Z are again the vanguard: 40% are receptive, compared with 19% of lower-income consumers. London is the most innovation-friendly region; Northern Ireland the least.

What it means for growth

Dual-track product strategy is non-negotiable. With cash still weekly for four in ten Britons and mobile wallets surging among the young, providers must support both analogue and digital rails. Failure to serve cash-reliant segments risks regulatory heat under the FCA’s Consumer Duty, while ignoring wallets forfeits lifetime value in high-growth cohorts.
Trust features are the new growth engine. Security outranks convenience, so investments in real-time fraud analytics, biometric authentication and transparent refund policies will likely convert more fence-sitters than additional loyalty points.
Wearables and social commerce are the next addressable markets. Adoption curves mirror the early days of contactless: small base, rapid generational skew, urban hotspots. Payment orchestration platforms that can tokenise across watches, rings and even AR devices will be first in line when critical mass arrives.
Addressing the affluence divide unlocks real volume. Digital uptake tracks affluence. Products that lower onboarding friction and offer budget-management tools (e.g., real-time balances, spending caps) could bridge the gap and deliver inclusive growth.
Cross-border opportunity remains fragmented but lucrative. Cash is still the single largest method for Brits abroad (17%), yet mobile-wallet preference among under-35s has tripled in two years. Fintechs offering multi-currency wallets, transparent FX and offline wallet functionality can capture this latent demand.

Outlook

The UK’s payment market is advancing on two fronts: incremental upgrades to entrenched card infrastructure and experimental forays into mobile, wearables and potentially a digital pound.

Growth will come less from launching the next hot app than from stitching together a lattice of options that feel equally safe, seamless and familiar to a 20-year-old and a 70-year-old pensioner. Firms that master that balancing act — while keeping fraud at bay — will define the sector’s next chapter.

Ready to capture the next wave of payments growth?

Lagom Consulting partners with Payments and E-money fintechs to turn market insight into measurable results. We can support your business with:

· Growth & GTM playbooks – bespoke strategies that move you from concept to commercial traction, fast.

· Hands-on implementation – senior operators who embed with your teams to execute and iterate in-market.

· Board-level guidance – actionable advice on scaling revenue, navigating regulation and optimising unit economics at home and abroad.

· International expansion & M&A – from first licence to full-stack acquisitions, we help de-risk your cross-border ambitions.

Whether you’re plotting your UK breakout, eyeing a international foothold or teeing up strategic deals, Lagom Consulting brings the experience and rigour to get you there.

Let’s build your next growth chapter.

Who are Lagom Consulting?

At Lagom Consulting, we pride ourselves on being more than marketing and management consultants; we are your strategic allies in building marketing strategies to market into financial services market.

Our ethos centres around delivering first-class service, underpinned by a hands-on approach that melds practical problem-solving with time-tested marketing solutions. We recognise that effective marketing is an ongoing journey, not a one-off exercise. We steer clear of ‘random acts of marketing’, opting instead for a comprehensive and sustained approach.

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Jonathan Greenstein