Covid unlocking lifts card spending above pre-pandemic levels

The initial lifting of Covid restrictions in April provided a shot in the arm for card spending in the UK, shows new figures released today.

Data from UK Finance reveals the value of card transactions in the UK in April was 11.2 per cent higher than in the same in 2019, before the onset of the pandemic.

Total spend on cards reached £65.6bn, 53.4 per cent higher than April 2020, the first full month of lockdown after Covid took hold.

Read more: UK banks expect a rush of defaults in coming months

The surge in transactions was likely driven by consumers rushing to the high street and pubs to purchase products that had been unavailable for months due to strict restrictions to curb the spread of the virus.

Keith Grose, head of UK at Plaid, said: “The relaxation of lockdown restrictions has naturally given card spending a short-term shot in the arm, with consumers returning to the high street in their droves.”

The volume of debit and credit card transactions in the UK in April was 2.7 per cent higher than in the same period in 2019.

1.6bn card transactions took place in the UK, 76.4 per cent higher than in April last year, the first full month of lockdown since Covid took hold.

Covid triggers payments ‘revolution’

UK Finance’s figures show contactless payments accounted for 47 per cent of all credit card and 63 per cent of all debit card transactions.

The sharp rise in the proportion of contactless of payments can be attributed to consumers changing their behaviour to minimise physical interaction to reduce the risk of contracting Covid.

There were 963 million contactless card transactions in April, 260 per cent more than the 267 million in April 2020 and 32.9 per cent more than the 725 million in April 2019. 

The total value of contactless transactions was £11.9 billion in April, a 135 per cent increase on £5 billion in April 2020 and 74.7 per cent increase on £6.8 billion in April 2019.

“We are in the midst of a quiet payments revolution that will have long-term impact on the use of physical cards” Grose added.

Read more: Consumer credit borrowing exceeds repayments for first time since August