UK cash payments decline is accelerating, with cash now representing just 8% of all payments made in 2025, down from 9% the previous year and 45% a decade ago, according to UK Finance‘s Payment Markets Report for 2025. The body projects cash will account for only 4% of transactions by 2035.
UK Finance is a trade association representing the banking and finance industry. Its annual Payment Markets Report draws on payment figures provided by its members alongside consumer research, and this year’s edition captures a payments landscape that has shifted decisively towards digital channels.
How UK cash payments decline compares to the rise of digital
Cash use fell to 3.9 billion payments in 2025, down from 4.3 billion the year before. By 2035, the report expects that figure to drop further to around two billion transactions annually. At the same time, more than nine in 10 UK adults (91%) were using at least one form of online, mobile or telephone banking in 2025, up from 88% in 2024.
Mobile banking is now the preferred option, used by three-quarters of adults. Nearly two-thirds (65%) of UK adults were registered for at least one mobile payment service in 2025, up from 57% in 2024. Adoption varies considerably by age: around 89% of 25 to 34-year-olds are registered for a mobile payment service, compared with 29% of over-65s.
Debit cards remain the single most-used payment method, with 26.6 billion payments in 2025, accounting for more than half of all UK payments. That figure is forecast to reach 29.5 billion by 2035. Contactless payments also grew, reaching 19.2 billion in 2025 from 18.9 billion the previous year, driven by the rollout of card acceptance devices and the growth of services such as Apple Pay and Google Pay. Contactless made up 39% of all payments in 2025, compared with just 3% a decade ago, and is expected to reach 41% by 2035.
Adrian Buckle, head of research at UK Finance, said: ‘UK Finance’s latest data show that the UK is now a predominantly digital economy when it comes to making and receiving payments. The trends of the past decade are becoming increasingly established. Cash usage is declining, albeit more gradually, and growth across many payment methods is stabilising as the market matures.’
Faster Payments and the real-time revolution
One of the fastest-growing corners of the payments landscape is account-to-account transfers. Faster Payments and other remote banking payments reached 6.2 billion in 2025, making them the second most-used payment method in the UK. By 2035, that figure is expected to rise to 8.4 billion, accounting for 16% of all UK transactions. UK Finance points to consumers splitting bills and sending money to friends and family as key drivers, replacing transactions that would previously have involved cash.
The scale of opportunity in real-time payments is underlined by projections from Market Research Future, which projects the UK real-time payment market to grow from $1,463.9 million in 2025 to $23,932.7 million by 2035, a compound annual growth rate (CAGR, meaning the year-on-year average growth rate) of 32.2%. More broadly, Spherical Insights & Consulting projects the UK digital payment market overall to reach $38.2 billion by 2035. Neither figure comes from UK Finance’s own report, but both sit in the same direction of travel the report describes.
Buckle added: ‘The industry is now entering a new phase of innovation. New payment technologies have the potential to reshape how people and businesses move money, and continued close engagement across government, regulators and industry will be essential to unlock that potential.’
Cash still matters for millions
Despite the broader shift, the UK cash payments decline does not mean cash is disappearing for everyone. Around 1.4 million UK adults mainly use cash for day-to-day spending, and 49.3 million people used a cash machine in 2025. A further 19 million adults use cash once a month or less, suggesting a large population somewhere in between.
John Howells, chief executive of ATM and cash access network Link, said: ‘While cash use continues to decline in every part of the UK, it remains vital for millions of people. Link will continue working to ensure people can access cash for free on the high street.’
Gareth Oakley, chief executive at Cash Access UK, pointed to the rollout of banking hubs as one practical response: ‘For those who rely on cash and for many more, who still need basic banking services, we are pleased to be rolling out banking hubs across the country, with almost 250 open already.’
Buy now, pay later (BNPL) services also featured in the data, with an estimated 12.9 million UK adults (22%) having used them at least once in 2025. The BNPL sector came under regulation by the Financial Conduct Authority (FCA) in July 2026, giving customers stronger protections, a development that could reshape how that slice of payments grows in the years ahead.
