The limit on contactless payments is set to rise massively in October, marking the second increase in less than two years.
As part of plans to get people 'back on the high street', the government will allow shoppers to pay up to £100 using their contactless cards.
The change had been announced earlier this year, but banks had not yet decided when to introduce the new limit.
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Chancellor Rishi Sunak said: "Increasing the contactless limit will make it easier than ever to pay safely and securely.
"As people get back to the High Street, millions of payments will made be simpler, providing a welcome boost for retailers and shoppers."
David Postings, chief executive of trade body UK Finance, said: "Contactless payment has proved very popular with consumers and an increasing number of transactions are being made using contactless technology.
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"The increase in the limit to £100 will allow people to pay for higher value transactions like their weekly shop or filling up their car with fuel.
"The payments industry has worked hard to put in place the infrastructure to enable retailers to update their payments systems so they can start to offer their customers this new higher limit."
There are concerns that some shops may take longer to bring the new limit in as they will need to update their terminals, while some worry that the increase may make cards more of a target for thieves.
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According to the BBC, a report for UCL's Jill Dando Institute of Security and Crime Science outlined how credit and debit cards were seen as 'hot property' for criminals, with concerns that the next increase in payment limits will make it more tempting for them to ramp up their efforts.
The report said: "Raising the contactless card limit to £100 would likely make card theft more attractive, increasing a broad range of acquisitive crimes including snatch theft of wallets and purses, hold-up robberies, and home and vehicle break-ins to find cards that can be used fraudulently.
"Past experience suggests it could attract new cohorts of teen criminals who are more likely to progress to extended criminal careers, with implications for longer term crime rates."
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