The Financial Conduct Authority has removed the regulatory requirement that imposes a single national cap on contactless card payments, effective March 2026. Under the new rules, banks and payment providers with robust fraud controls will be allowed to set their own contactless transaction limits — or remove them entirely. The change represents the most significant shift in UK contactless payment regulation since the technology was introduced.

The current single-transaction limit of £100 is not expected to change immediately at most providers. Cumulative checks — typically capping spending at £300 or five consecutive taps before requiring PIN authentication — will also remain at the discretion of individual firms. However, the regulatory framework now permits providers to raise, lower, or eliminate these thresholds based on their own fraud detection capabilities.

The FCA is also requiring firms to give customers more control over contactless payments, including the ability to set personal spending limits or turn off contactless functionality altogether. This follows consultation feedback highlighting concerns about overspending and financial abuse. Firms must implement "clear communications and robust safeguards" and continue to refund customers in cases of unauthorised fraud.

The scale of the impact is significant: nearly 95% of eligible in-store card transactions were contactless in 2024, according to Barclays data. David Geale, FCA executive director of payments and digital finance, said: "Contactless is people's favoured way to pay. We want to make sure our rules provide flexibility for the future, and choice for both firms and consumers."

Kate Nicholls, chair of UKHospitality, welcomed the change: "Making life easier for consumers is a positive for any hospitality and high street business." The move aligns the UK with other markets that have already removed fixed regulatory limits, placing the responsibility for fraud prevention squarely on the firms that issue payment cards.