The number of Visa-branded contactless cards in use in the United Kingdom could reach 12 million by the end of the year, Visa Europe predicts.

The total in June surpassed 8 million, and the card brand believes the number will climb as more banks this year introduce cards with contactless functionality. Moreover, UK cardholders also now may make contactless payments for purchases up to 15 British pounds (US$23 or 18 euros), up from 10 pounds earlier this year.

Visa Europe estimated the growth projection based on its member banks reporting the number of contactless cards they issue each month, Mark Austin, Visa Europe head of contactless, said via an e-mail. Additionally, Visa’s member banks “also provide us with forecasts for the end of the year,” he added.

Though cardholders may use the contactless function only for small transactions, merchants benefit because it reduces their cash-handling and operating costs, Visa Europe contends in a news release. It also reduces how much cash they need on hand and offers improved security and risk management, the card brand says.

Moreover, “contactless transactions are quicker to process, which can decrease checkout time, leading merchants to serve more customers in a given time period,” Austin said over e-mail.

The average sale amount for a contactless transaction in the UK is 4.30 pounds, suggesting consumers are “keen to use cards for smaller amounts rather than carrying cash,” Austin said in a recent news release. Moreover, in the past six months, “we have seen an increase of 100% in transaction volumes,” he added. Visa Europe officials could not provide specific transaction data by PaymentsSource deadline.

Matt Simester, director of Auriemma Consulting Group in the United Kingdom, agrees with Visa’s forecast, noting most credit and debit cards in the UK are now contactless-enabled. The main challenge, however, will be persuading merchants to accept contactless payments so the acceptance rate also increases, he says.

Some 26,000 merchants accept contactless payments in the UK, according to Visa Europe, including Subway restaurants, Pret A Manger restaurants, Ikea Systems BV stores and several independent convenience stores.

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