Local payment methods in UK set to overtake cards online, study shows

By Puja Sharma

Contactless payments have become second nature for consumers in mature markets. New research from myPOS shows that 69% of people in the UK now primarily pay by tapping a card, smartphone, or smartwatch. At first glance, this suggests a continued dominance of card-based payments. However, a closer look at global payment trends reveals a more fundamental shift underway, one that could significantly reshape the payments landscape over the next five years.

According to research from Boku and Juniper Research, mobile-native, non-card local payment methods (LPMs) are expected to overtake cards as the leading way to pay online by 2028. This transition is not incremental. By that year, 59% of global eCommerce transaction value is projected to flow through LPMs rather than traditional card networks. With global payments volumes on track to reach $290 trillion by 2030, the implications for banks, payment networks, fintechs, and merchants are substantial.

In practical terms, this shift means that nearly 60% of eCommerce transactions globally will be powered by local payment methods, representing an estimated $7 billion per year moving away from card rails into a fragmented ecosystem of alternative payment systems. These include account-to-account payments, real-time bank transfers, carrier billing, and region-specific digital wallets that are often deeply embedded in local financial infrastructure.

The rise of LPMs reflects changing consumer behaviour, particularly among Gen Z and digitally native users who prioritise speed, convenience, and familiarity over legacy payment instruments. In many markets, consumers increasingly prefer payment methods that are native to their banking or mobile ecosystems rather than card-based abstractions layered on top. This trend is especially pronounced in regions where cards never achieved universal penetration, but it is now accelerating even in traditionally card-heavy markets.

Stuart Neal, CEO of Boku, attributed this transformation to both demand-side and supply-side forces. “Local Payment Methods (LPMs) have had a meteoric rise over the past decade. It’s hard to overstate what a significant and rapid change we’ve seen, and behind it are two main driving forces: changing consumer preferences and rapid technological innovation,” he notes. His observation highlights a broader reality for the payments industry. The shift toward LPMs is not simply about cost or checkout optimisation; it reflects a deeper alignment between payments infrastructure and how consumers already manage money in their daily lives.

For merchants, the implications are becoming increasingly clear. Capturing a share of the $10.6 trillion global eCommerce opportunity will depend less on optimising card acceptance and more on supporting the right mix of local payment methods across geographies. Failure to do so risks excluding large segments of customers who may abandon transactions if their preferred payment option is unavailable. This is particularly relevant for cross-border eCommerce, where reliance on cards alone can limit reach and increase friction.

From a fintech and infrastructure perspective, the rise of LPMs introduces both opportunity and complexity. While alternative payment systems can reduce dependency on global card networks, they also create challenges around orchestration, reconciliation, fraud management, and regulatory compliance across jurisdictions. As a result, demand is growing for payment platforms that can aggregate, manage, and optimise multiple local methods through a single integration.

Ultimately, the data points to a payments ecosystem in transition. Cards are not disappearing, but they are no longer the default endpoint of digital commerce. Instead, they are becoming one option among many in a rapidly diversifying payments stack. As consumer preferences continue to evolve and real-time payment infrastructure expands globally, local payment methods are moving from the periphery to the core of digital commerce strategy.