UK Chancellor of the Exchequer Rishi Sunak will announce an increase in the maximum spend via contactless payments from £45 to £100 in today's budget.
Contactless payments have become increasingly popular among shoppers - with most shops encouraging contactless as a more Covid-safe way to pay.
Debit card payments using contactless have risen from 4 out of 10 payments in 2019 to 6 out of 10 payments in September 2020.
Sunak said in a statement: "As we begin to open the UK economy and people return to the high street, the contactless limit increase will make it easier than ever before for people to pay for their shopping, providing a welcome boost to retail that will protect jobs and drive growth across the capital."
The contactless payment limit has already been increased once (from £30 to £45) at the start of the pandemic back in April.
The increased limit becomes law from today (3 March), but shoppers might not see an immediate change since the companies need some time to adjust to the changes.
The Financial Conduct Authority (FCA) proposed the increase back in January, writing: "Since the limit for contactless card payments was raised to £45 last April at the start of the pandemic, people are increasingly making use of contactless payments.
"It's important that payments regulation keeps pace with consumer and merchant expectations. Recognising changing behaviour in how people pay, as part of a wider consultation, we will shortly be seeking views on amending our rules to allow for a possible increase in the contactless limit to £100."
In the budget, Sunak will also extend the furlough scheme until the end of September. The scheme was previously set to end in April.
Universal Credit is expected to be extended for six months.
Retail, pubs and restaurants are expected to receive a £5 billion grant scheme. Individual facilities could receive up to £6,000.
Hotels, gyms and personal care and leisure firms, could receive up to £18,000. Along with the hospitality sector, those were the most affected businesses during the lockdown.
With the property market also heavily impacted by lockdown, Sunak is expected to announce a new mortgage scheme. The guarantee scheme will allow for a deposit of 5 percent on purchases of properties worth up to £600,000.
The stamp duty holiday is also expected to be extended on houses worth up to £500,000. Currently, the stamp duty holiday is due to end on 31 March.
Chancellor Rishi Sunak will address the changes at his speech at the House of Commons at around 12.30pm today.
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Words: Cilene Tanaka
Topics: UK News, Money, rishi sunak