A major overhaul of contactless payment rules is set to grant banks new powers while raising significant security concerns for UK shoppers. The Financial Conduct Authority (FCA) has confirmed it will scrap the universal £100 spending cap on tap-and-go transactions from 19 March 2026.
What the New Rules Mean for Banks and Shoppers
Under the incoming framework, the responsibility for setting contactless limits will shift from the regulator to individual banks and card issuers. This means financial institutions will be free to set their own higher maximums or even remove limits entirely for customers.
Payment expert Chris Jones, managing director at PSE Consulting, clarified that the change is less about consumer convenience and more about redistributing liability. "By lifting the contactless cap, the FCA is stepping away from a blunt, one-size-fits-all rule," he stated. "It puts the onus on banks and card providers to manage their own risk exposure levels."
He emphasised that the real benefit for consumers should be greater control through banking apps, such as the ability to set personal thresholds or switch contactless functionality on and off instantly.
Heightened Fraud Risks and Industry Warnings
The relaxation of limits has sparked serious warnings from cybersecurity professionals. Jonathan Frost, director of Global Advisory for EMEA at BioCatch, highlighted alarming FCA projections. The watchdog estimates the policy shift could lead to an additional £31.3 million in contactless fraud annually—a staggering 131 percent increase.
"The core question is whether raised limits will trigger long-term impacts, such as shifts in criminal behaviour," Frost noted. He urged banks to prioritise advanced, real-time fraud detection systems that analyse customer behaviour patterns, not just transaction values.
Chris Jones added a stark warning for the financial sector: "Banks that treat this as a trust-building opportunity will strengthen customer relationships. Those that rush to increase limits without clear safeguards and communication risk eroding confidence."
Vulnerable Consumers at Greater Risk
Consumer advocates have voiced profound concerns about the impact on disabled people and those with certain long-term conditions. Georgina Colman, founder of discount scheme Purpl, warned that the change "carries real risks" for many.
"For people with ADHD or other neurodivergent conditions, impulsivity and dopamine-seeking behaviours are well documented," Colman explained. "Higher frictionless spending limits could make it far easier to overspend without realising until the damage is done."
She also cautioned that individuals with dementia, learning disabilities, or cognitive impairments could face a greater threat of financial abuse, as higher limits make it easier for others to coerce spending. Colman argued forcefully for personalised caps and robust optional controls, stating: "A single higher blanket limit assumes everyone manages money in the same way, which simply isn't true."
The move marks the latest step in the evolution of contactless payments, which launched in 2007 with a £10 cap before rising to £30, £45, and finally £100 in October 2021. All eyes will now be on how banks implement their new freedoms and what protections they put in place ahead of the March 2026 deadline.
