Annual domestic card spending by UK consumers passed £0.5 trillion for the first ever time in 2013 as shoppers increasingly choose cards over cash, according to a report published today [4 June 2014] by The UK Cards Association.
Three-quarters (74.5 per cent) of all retail spending is now made using debit and credit cards – up from less than half (46.5 per cent) in 2003 – highlighting a clear shift in consumer behaviour in the past decade.
The UK Card Payments 2014 report reveals that Britons spent £520 billion on UK goods and services using their debit and credit cards last year, a rise of 6.7 per cent since 2012 (£488 billion). Card spending has more than doubled over the last decade, up from £244 billion in 2003.
Adding spending by overseas visitors, the total value of purchases on debit and credit cards in 2013 was £534 billion, meaning that spending on cards now constitutes a third (33 per cent) of the UK’s total GDP (£1,612 billion in 2013). This proportion has increased from under a quarter (22 per cent) just a decade ago in 2003 (when total card spend was £257 billion and GDP was £1,148 billion). 
Reflecting consumers’ desire to pay down debt when they can, the increase in spending across debit and credit cards is in contrast to a 15.6 per cent fall in outstanding borrowing on credit cards since peaking at a monthly average of £67.4 billion in 2005 to an average of £56.4 billion in 2013.
Melanie Johnson, Chair of The UK Cards Association, said:
“With three in every four pounds spent in British shops now paid with cards, these figures reveal a huge shift over the last decade in the way we chose to transact. Rather than carrying cash, consumers are increasingly opting for their cards instead, not least because of the extra protections available.
“The rise in online shopping, coupled with increasing momentum behind contactless cards, will likely see this trend in consumer behaviour continue.”