Much like the rest of the UK, Wales has witnessed a steady shift in how people pay for products and services over recent years. The widespread adoption of smartphones coupled with the improvement of internet speeds across the country has been integral to the rising popularity of pay-by-phone transaction methods, which not only have negated the need for cash, but also credit and debit cards. Contactless mobile payments have already had a significant impact on the Welsh economy, streamlining services across multiple sectors while laying the foundations for long-term digital infrastructure. But how exactly has pay-by-phone altered the landscape in Wales – what has changed, what is working, and what is still problematic?
The growing popularity of mobile payments
In July 2015, the UK became the first country outside of the US to get Apple Pay, the tech giant’s pioneering mobile payment service. This was shortly followed by Google Pay in 2016 and the steady integration of pay-by-phone methods across British banking and retail. Driven largely by younger demographics, mobile payments have continued to rise, with their use further accelerated by the COVID-19 pandemic and the requirement for efficient, contactless payments. Post-pandemic, pay-by-phone has become the default option for many, highlighted by the transaction limit rise from £45 to £100 in 2021. This year’s figures from UK Finance found that half of all UK adults now regularly pay for things with their phones, with this figure rising even more among those aged 50 and below.
Such widespread use has been further facilitated by the arrival of several innovative payment platforms, such as Stripe, Square, and SumUp. All of which have enabled businesses to join the cashless movement through offering affordable mobile payment readers and expanding digital inclusion into rural areas such as those throughout Wales.
Well-suited to our modern world
The multi-faceted advantage of mobile payments lies in the improved convenience, speed and security of transactions. Consumers can now pay with a single tap, fingerprint, or face scan, with payments processed almost instantly. The biometric authentication required has greatly improved transaction security, with risks such as card fraud and petty theft no longer a threat to bank accounts. Furthermore, in our increasingly online existence, the digital integration of payment services has become more critical. Here, pay-by-phone stands above the rest, with digital wallets making online payments seamless, especially compared to the clunkiness of manually entering card details.
Which sectors have benefited most?
Across Wales, tangible positive changes can be seen within multiple sectors thanks to the adoption of mobile payments.
Local authorities have benefited significantly, with pay-by-phone particularly transforming parking payment procedures. Pembrokeshire County Council for example, launched its mobile payment service to cover over 3000 parking spaces across 32 locations in 2021, a decision that was then followed across the country in Conwy, Anglesey, Glamorgan, Gwynedd and Denbighshire. By 2024, a reported 55% of all parking payments in Gwynedd were done by mobile. Such changes have been hugely beneficial for councils, providing a solution to outdated cash-only pay and display meters while reducing the need for excessive parking officers.
Transport is another big winner. While contactless payments for trains and buses have been available in London for well over a decade, the rest of the country has only recently started utilising mobile capabilities to streamline ticketing. Transport for Wales (TfW) has been at the forefront of this, with South Wales becoming the first region outside of the capital to introduce a contactless pay-as-you-go (PAYG) system using mobiles. Across the rest of Wales, customers are able to purchase and store digital tickets on apps like Trainline, negating the need to purchase physical tickets at the station. The effect is a huge reduction in queues, a simplification of the payment process and the easing of travel anxiety for many passengers.
Elsewhere, retailers, hospitality venues and entertainment platforms across Wales have benefited from more efficient pay-by-phone solutions. Our increasingly cashless society has threatened the livelihoods of rural businesses that rely heavily on cash; however, the development of effective mobile solutions has proved transformative for many of these traders. Leading platforms in the ever-growing iGaming industry have also introduced mobile payments in recent years, minimising payout times while maximising transaction security. The playing experience has improved to such a degree that many players now seek out the best online casinos that accept mobile payments. What’s more, the emergence of digital order-and-pay apps has transformed the hospitality sector, enabling bars, cafes and restaurants to minimise queues while simultaneously lowering operating costs.
Complex challenges remain
The steady surge in pay-by-phone methods, however, has come with its problems. A primary issue is the reliability of mobile coverage across large regions of Wales. Rural, mountainous areas like Bannau Brycheiniog and Eryri are well known for their poor mobile service, a sticking point that hampers the effectiveness of mobile payment solutions. This is reflected by recent Ofcom data showing Wales’ lower coverage compared with the UK average.
There is also the key challenge of overcoming digital exclusion faced by those who continue to use traditional payment methods. This is particularly prevalent among older, less tech-savvy generations and in low-income, disadvantaged communities that may lack the necessary digital infrastructure. Wales remains firmly in a transitory phase, and while the phasing out of outdated systems is integral to moving forward, any changes must be followed by adequate support for those who need it.
The transition from cash to mobile payments in Wales is merely reflective of the broader trend in the UK, and ultimately of changing consumer behaviours at a global level. There is no denying the positive effect the growing adoption of pay-by-phone methods has had on the Welsh payment market, maximising convenience for customers, streamlining operations for businesses and improving local services for communities. As younger, more technologically fluent generations enter the consumer market, expect mobile payments to cement themselves as the dominant transaction method further. Could cash soon be a relic of the past?
