The FCA has adjusted its stance on contactless payment limits, granting card issuers the freedom to determine their own thresholds for customers.

Card providers can now let their users modify personal contactless spending caps or disable this feature entirely. This shift in policy aligns with recent guidance, moving away from an earlier consideration by the FCA of removing the GBP 100 limit, as detailed in a March announcement.

Mor e convenience for customers

The Financial Conduct Authority (FCA) believes that advances in payment technology and improved fraud detection mechanisms warrant greater autonomy for firms to configure contactless limits according to their customer base. Immediate changes are not anticipated; however, the FCA encourages financial institutions to develop flexible solutions aimed at enhancing user convenience within the UK.

Customers remain protected even if their cards are used fraudulently since card issuers will reimburse unauthorized transactions. Contactless payments enjoy similar safeguards as traditional card payments, with banks and companies obligated to cover such incidents. According to UK Finance’s Annual Fraud Report 2025, contactless fraud represents a lower risk compared to other forms, averaging approximately GBP 1.3 per GBP 100 spent in contactless transactions versus GBP 6 for all unauthorized cases.

This initiative is part of the FCA’s broader strategy detailed in its January letter to the Prime Minister, which includes 50 measures aimed at fostering economic growth and emphasizing digital innovation. Public consultation on these proposals will extend until October 15, 2025. One proposal suggests allowing firms using advanced technology for fraud prevention to set custom limits, similar practices observed in the United States.