The UK will be responsible for over a quarter of all electronic payments - around 29.44bn - in Western Europe by 2009, representing a compound annual growth of 9.80%, according to research released by ACI Worldwide.
The study, which was conducted by Global Insight and is based on historical and current data spanning 79 countries, shows that the UK's electronic payments growth is above the current Western European average of 8.3%, which is itself the lowest of all global regions (average 12.3%).
However, despite the far greater usage of electronic transactions than any other country in Western Europe, the UK will still witness the second highest growth in number of transactions in the world. The UK is also predicted to rise from third highest user of electronic transactions per head of population (308 e-payments/head) to second by 2009 (482 e-payments/head). The highest will be Finland at 515 e-payments/head of population.
The UK's level of electronic payments is forecast by 2009 to consist of 18.6bn retail payments (10.72% growth) and 4.1bn retail transfers (9.33% growth). The study predicts that it will also comprise 6.6bn wholesale payments which represents 70% of all such transactions in Western Europe. The UK is also forecast to continue the steady reduction in cheque usage declining, by 5.8% to 1.5bn by 2009.
Commenting on the research, Richard Launder, president of ACI Worldwide EMEA, says: "For banks, these results are a positive endorsement in the strategy to move towards a cash free society. The high acceptance of electronic payments in the UK shows that banks are providing efficient and valued services to their customers.
"Further efficiencies will be possible as payments infrastructure converges to the benefit of both the banks from a cost perspective and the customers in terms of efficiency of their various payment services."
The report also predicts that Eastern Europe will see largest electronic payment CAGR of 21.6% to 25.8bn. The US will have the largest volume growth adding 52.27bn transactions bringing its predicted total to 118.29bn which represents a 12.37 percent CAGR. The UK, France and Germany accounted for 63% of all Western European electronic transactions in 2004 and are predicted to retain this dominance in 2009.
The study also shows that Ireland (17.79%) and Luxembourg (16.02%) will see fastest electronic growth rates in Western Europe, while Italy will have the slowest at 4.98%.
Chinese electronic payments growth is expected to continue to soar over the next five years, with a compound annual growth of 31.60% at 22.87bn.