Over half of UK adults (57%) are now using mobile wallets, according to the latest figures from UK Finance, a trade body organisation.

Payment habits continue to evolve in the UK, as digital options grow in popularity. Debit, credit, and charge card payments (both physical and mobile) accounted for 64% of all UK transactions.

Debit cards were the most used payment method with 26.1 billion payments made in 2024.

More people are now using digital payments, with rising use of in-app purchases, digital wallets, and Buy Now Pay Later  – which was used by a quarter of UK adults – for shopping

At the same time, cash payments have again fallen. These trends show how people are increasingly turning to digital payment options, a shift that is expected to continue in the years ahead.

Consumers were responsible for 84% of all payments last year, mostly for day-to-day purchases. Businesses, government, and not-for-profit organisations accounted for 16%, including salary, pension, and benefit payments to individuals and payments between organisations.

More people are using their phones, watches or other mobile devices to manage money and make purchases – 2024’s figures were 15 percentage points higher than 2023.

Users who register for a mobile wallet service, quickly seem to become frequent users – where contactless card payments replaced what were once low-value cash payments, now contactless mobile payments appear to be replacing contactless payments initiated using a physical card.

Of those who used mobile payments, half used them monthly, and 44% weekly or more often. While younger people still lead the way in terms of adoption – 88% of 16-24 year olds – among those aged 65 and over, registration rose from 14% in 2023 to 25% in 2024.

Mobile banking, via a banking app for example, became the most common way to access accounts in 2024, used by 75 per cent of UK adults. It also overtook desktop banking for the first time. People now use mobile banking not just to check balances, but to make payments and manage their money.

As a result, Faster Payments – the system behind most real-time bank transfers – rose by around 14 per cent to 5.6 billion transactions last year, making it the UK’s second most-used payment method after cards.  

UK Finance predicts that mobile wallet use will grow, with more people, including older age groups, registering and using them more often for everyday payments.

New services, like Pay by Bank, are also expected to become more common, letting people pay straight from their bank account instead of using a card.

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Still, cards are expected to remain the most popular way too pay, accounting for around 67% of all payments. Contactless is set to grow, however, reaching 43% of all payments in the UK.

“2024 was a year of firsts, all pointing to the growing shift towards digital payments – more than half of UK adults used mobile wallets, mobile banking overtook desktop as the main way people access their accounts, and cash fell below 10 per cent of all payments,” Adrian Buckle, head of research at UK Finance, said.

“These changes weren’t just driven by younger consumers. We saw growth in mobile wallets and Buy Now Pay Later across older age groups too, highlighting how digital payments are becoming more mainstream across the board.

“Action from regulators to improve competition, along with the rollout of the National Payments Vision, aimed at fostering a new era of innovation in payments, is helping to create the conditions for further change in the years ahead.”