DECADES OF TAXI CARD PAYMENT EVOLUTION: From an expensive clunky offering to slick contactless cheaper solutions
The UK taxi industry has seen a significant shift in payment methods over the decades. What was once an industry dominated by cash transactions has now largely moved towards digital payments, driven by technological advancements and regulatory changes.
In the early days of digital card payments, the technology was costly and slow. Payment terminals were bulky, unreliable, and expensive to operate. These costs were often passed directly to passengers as an additional fee on top of the meter fare. Many drivers resisted the change, preferring cash for its immediacy and lack of transaction fees which could reach up to 10% of the payment value.
As technology advanced, card payment machines became smaller, faster, and more affordable. However, uptake remained slow, particularly outside major cities where cash was still king. The industry’s reluctance to fully embrace card payments was partly due to processing fees and the belief that cash provided greater financial control for drivers.
In recent years, the regulatory landscape has changed. London led the way in 2016 by making card payments mandatory in black cabs, with the card reader required to be accessible in the passenger area. Other UK cities have since followed, introducing similar rules to modernise the industry and meet passenger expectations. Despite this, some regions still lag behind, with cash remaining the dominant payment method choice in some areas.
The pandemic accelerated the decline of cash transactions across all industries, including taxis. Health concerns and a shift in consumer habits meant that contactless payments became the norm. Ride-hailing platforms, already built on digital payment systems, reinforced this trend, making it clear that the traditional taxi industry needed to adapt or risk losing passengers to more convenient alternatives.
Today, offering card payments to passengers is no longer an optional extra but an expectation. Customers demand choice and convenience, and in an increasingly cashless society, taxis must keep pace with modern payment methods to remain competitive. While cash still plays a key role, particularly among older passengers and in areas where digital infrastructure is less developed, the ability to accept card payments is now a necessity for most drivers across the UK.
The industry continues to evolve, and those who embrace digital payments on the same platform as cash will be better positioned for the future.
