Retail payments in the UK are transforming at unprecedented speed. As technology advances and consumer expectations rise, payments are becoming faster, simpler, and more intuitive. Whether tapping a phone at the till or completing an online purchase in a single click, UK consumers are rapidly adopting frictionless payment experiences.
UK shoppers are increasingly digital-first, with cash usage falling sharply to below 10% of all payments in2024, while 57% of adults now use mobile wallets such as Apple Pay and GooglePay (up from 42% in 2023) and contactless payments via cards, phones, and wearables dominating in-store purchases, accounting for around 38% of all payments and continuing to grow year on year1.
These figures reflect a broader shift in expectations: today’s consumers demand speed, simplicity and security in every transaction.
The Rise of Seamless and Frictionless Payments
Modern payment methods are removing traditional barriers at checkout. Solutions like in-app digital wallet payments, Click to Pay, and one-click checkout are enabling customers to complete transactions in seconds without the need to enter card details every time. These solutions not only speed up the payment process but also enhance convenience and security, reducing basket abandonment and improving customer satisfaction.
1. Mobile Wallets and Contactless Technology
Mobile contactless payments enabled by smartphones, smartwatches, and other wearable devices have rapidly become a mainstream way of paying in the UK. In 2024, more than half of UK adults (c.a. 57%) were registered to use mobile wallets such as ApplePay and Google Pay, up significantly from 42% just a year earlier1.
2. In-App Purchases and Embedded Payments
Retailers and service providers from grocery delivery apps to ride-hailing platforms are embedding payment capabilities directly into their apps, allowing customers to complete purchases without leaving the platform. This streamlines checkout, reduces friction, and enhances convenience, leading to higher conversion rates, lower cart abandonment, and a smoother customer experience. In 2023, 72% of UK mobile wallet users reported making a purchase through a retailer’s embedded app2.
3. One-Click and Click to Pay
One‑Click and Click to Pay securely save customer payment details, enabling instant online checkout. In the UK, 58% of shoppers expect payments to be completed with a single click3.At the same time, around 60% of UK merchants are actively seeking one‑click checkout solutions to improve conversion and reduce abandonment4.
Real-world examples show how UK businesses are embracing modern payment innovations to improve customer experience and operational efficiency.
Retail & Supermarkets: Major retailers now offer QR code scanning, mobile wallet support, scan pay and go and self-checkout options. By allowing customers to tap and go with phones or wearables, queues shorten and turnover increases.
Hospitality & Quick Service: Restaurants and cafés are integrating mobile QR payments and tap-enabled tables, enabling customers to pay directly from their devices without waiting for a bill.
E-commerce Platforms: Online stores are adopting in-app purchases and saved card credentials for returning customers, significantly boosting purchase completion rates.
Transportation & Services: Contactless and mobile payments are now standard across public transport and city services. According to Transport for London, around 70% of pay-as-you-go bus trips are made using contactless cards or mobile devices5. Using payment data, TfL automatically calculates fares and applies daily and weekly capping based on the zones travelled, eliminating the need for customers to determine the correct ticket to purchase for their journey. This has contributed to high adoption of contactless and mobile payments and delivers a positive customer experience.
Across these sectors, embedded and contactless payments are streamlining transactions, enhancing convenience, and driving both customer satisfaction and business performance.
The digital transformation of retail payments in the UK is far from complete. Looking ahead, several trends are set to redefine how consumers pay and how businesses manage transactions:
1. Enhanced Contactless Experiences
Regulatory changes, such as proposals to lift the £100 contactless cap, will allow larger transactions without PIN entry, providing greater convenience and faster in-store payments.
2. Integrated Loyalty & Rewards
Payments and loyalty programmes are increasingly converging. Future systems will automatically apply points, discounts, or personalised offers during checkout, making every transaction more rewarding.
3. Biometric & AI-Powered Security
Fingerprint, facial recognition, and AI-driven fraud detection will become standard, balancing convenience with robust protection against payment fraud.
4. Wearable & Voice-Activated Payments
Emerging technologies like smartwatches and voice-activated devices are gaining traction, particularly among younger consumers, and have the potential to redefine everyday transactions.
5. Agentic Commerce
Agentic commerce enables human or AI-powered agents to initiate and complete payments on behalf of consumers, integrating transactions into assisted, conversational and advisory retail experiences. Learn more at https://www.cbschangepartners.co.uk/blog/introduction-to-agentic-commerce
6. Open Banking &Account-to-Account Payments
Open banking solutions, including Pay by Bank, enable direct transfers from bank accounts at checkout without cards, signaling a shift in how online payments may be processed in the future.
7. Buy Now, Pay Later (BNPL) and White Label Payment Processing
BNPL is increasingly embedded into the checkout process, giving customers more flexible ways to pay. In addition to third party providers, many retailers are now using white-label payment solutions, such as Next Pay, Very Pay which allow them to offer instalment or delayed payment options under their own brand. This keeps customers on the retailer’s website, strengthens brand control over the customer journey, and can help increase conversion rates and average order values (AOVs). As UK regulation comes into force, both third party and white-label BNPL solutions are required to be transparent and responsibly managed, balancing consumer protection with business growth. Learn more at https://www.cbschangepartners.co.uk/blog/fca-targets-bnpl-major-regulatory-shift-in-2026
Together, these trends point toward a faster, safer, and more seamless payment ecosystem, driven by technology, consumer expectations, and evolving regulatory frameworks.
The rapid evolution of retail payments in the UK presents both opportunities and challenges for retailers. As consumers increasingly expect fast, frictionless, and secure transactions ,businesses must adapt or risk losing market share. Adopting modern payment solutions can increase conversion rates, reduce basket abandonment, improve operational efficiency, and strengthen customer loyalty.
1. Upgrade Payment Infrastructure
Retailers should ensure that their payment capability supports contactless-enabled terminals, mobile wallets and self-checkout systems to deliver faster in-store transactions and a superior customer experience. Online, integrating one-click checkout, Click to Pay, and in-app payment capabilities ensures seamless digital experiences that meet rising consumer expectations.
2. Integrate Loyalty and Rewards
Combining payments with loyalty programmes allows retailers to automatically reward customers with points, discounts, or personalised offers during checkout, enhancing engagement and repeat purchases.
3. Adopt Advanced Security Measures
Implementing biometric authentication and AI-powered fraud detection balances convenience with robust protection, fostering trust and reducing payment-related losses.
4. Embrace Emerging Payment Technologies
Retailers should explore supporting wearables, voice-activated payments, and other innovative solutions to capture younger, tech-savvy consumers and future-proof their payment offerings.
5. Incorporate Agentic Commerce
Determine your strategic response to the momentum behind Agentic commerce and look to understand the quality, structure and maintenance of your data to support this growing phenomenon.
6. Explore Open Banking and Account-to-Account Solutions
Integrating Pay by Bank and open banking rails allows direct bank-to-bank transfers, offering cost-effective, secure alternatives to traditional card payments and reducing dependency on intermediaries.
7. Leverage Buy Now Pay Later (BNPL)
Integrating BNPL options at checkout gives customers flexible payment choices, improves conversion rates, and attracts shoppers seeking short-term financing. Retailers should ensure BNPL offerings are transparent, responsible, and compliant with evolving UK regulations.
8. Monitor Consumer Behaviour and Feedback
Continuously tracking adoption trends, transaction data, and customer feedback helps retailers adjust their payment strategy, optimise conversion, and stay ahead of competitors.
By taking these steps, UK retailers can fully harness the benefits of digital payments, delivering frictionless experiences, strengthening customer loyalty, and driving long-term business growth in an increasingly digital marketplace.
CBS Change Partners have 20 years’ experience in digital transformation and the payments landscape and are well placed to help you achieve your Transformation aspirations. Reach out to see how we can help you realise the opportunities this presents and mitigate the risks.
References
3. https://tink.com/blog/open-banking/uk-consumers-expect-seamless-payments/
Retail Perspectives #4 : Digital Transformation