Financial Conduct Authority says proposals to allow PSPs to set their own contactless limits would be more convenient for customers.
The UK's Financial Conduct Authority is consulting on changing its rules to provide banks and other payment service providers (PSPs) with greater flexibility to determine their approach to contactless payments. Under the proposals, the existing regulatory limits would be replaced with a new exemption which would allow providers to process contactless payments without asking the customer to enter a PIN, provided the PSP has identified the transaction to be low risk. PSPs would still be able to set or maintain contactless limits as they see fit, in line with their business and customer needs, subject to robust risk management and ongoing transaction monitoring.
In a press release announcing the proposals, David Geale, Executive Director of Payments and Digital Finance at the FCA, said that in view of smarter payment technology and more well-established fraud controls, "it's the right time to let firms tailor contactless payments to fit their customers' needs and drive innovation."
The FCA's consultation is open until 15 October 2025.
