Internet spending has jumped by more than a quarter in the last two years, a new report analysing how the UK uses payment cards online reveals. Card spending on the internet totalled £154 billion in the UK in 2016, averaging £422 million a day, figures from The UK Cards Association show. This is a rise of 28 per cent since 2014, when online spending amounted to £120 billion.

Analysis finds one in four card purchases online is on entertainment, with consumers buying cinema and concert tickets, takeaway orders and digital content.

Figures also show the UK spends online more per household than any other country, at US$5,900 in 2015. This is higher than Norway (US$5,400), the USA (US$4,500) and Australia (US$4,000).

The report looks at internet spending patterns on debit and credit cards in the UK and finds that:

  • A quarter (26 per cent) of all card spending was online last year, up from 22 per cent in 2014
  • 1.8 billion purchases were made online in 2016, an average of 150 million a month. This is an increase of 38 per cent from 1.3 billion in 2014
  • Entertainment sales make up the highest proportion of all online purchases (26 per cent); although these only account for 7 per cent of the total value, reflecting the relatively low cost of digital entertainment such as apps and music downloads
  • While 41 per cent of in-store card purchases are on food and drink, the sector only makes up 7 per cent of online transactions
  • More than a quarter (27 per cent) of all online spending by value is on financial services, the highest share of any sector.

Richard Koch, Head of Policy at The UK Cards Association, said:

“The internet enables millions of people to access services around the clock from wherever they are based. Payment cards have driven this revolution, providing an easy and secure way to shop online, whether it is to buy an app for your phone or a sofa for your living room.

“Since the early days of internet shopping there has been a host of innovations, from digital wallets to one click purchases, which bring enhanced security, choice and convenience for customers and which will lead to continued growth in the sector. The additional protection provided when using a card also gives consumers extra peace of mind when they are shopping online.”

The report also reveals the dominance of online spending in certain sectors:

  • Nearly four in every ten pounds (37 per cent) spent on travel is paid for online, with 54 per cent of spending on flights made through the internet
  • Consumers now go online for a quarter (23 per cent) of all clothing spending
  • Event tickets are now mainly bought via the internet, with 67 per cent of concert ticket spending and 61 per cent of cinema, theatre and dance spending made online
  • In-store shopping still dominates at some businesses such as pawn shops (98.6 per cent of spending in-store), laundry and cleaning (98.3 per cent), and pubs (98.2 per cent).

In the past two years the average card purchase online has dropped by £9, highlighting that internet shopping is no longer the domain of big ticket items. However the average e-commerce purchase (£85) is still more than double in-store sales (£38).

The report covers debit and credit card transactions made over the internet and processed in the UK.