Consumers' annual spending on cards topped £500 billion for the first time across 2013, a report has found.
Debit and credit cards accounted for three in every four pounds spent in shops, up from two in every four just a decade ago, according to the figures published by trade body the UK Cards Association.
The UK Card Payments report found that Britons spent £520 billion on UK goods and services using their debit and credit cards last year, marking a 6.7% increase compared with the £488 billion spent over 2012.
When spending by overseas visitors was added, the total value of purchases on debit and credit cards in 2013 was £534 billion, meaning that spending on cards now constitutes one third (33%) of the UK's total GDP, up from around one quarter (22%) of GDP in 2003, the report said.
Debit cards can now be found in the wallets of 91% of UK adults, with a total of 47.5 million cardholders.
This is around half a million more cardholders than in 2012, and the report said that an "increased
proliferation" of bank accounts that automatically issue a debit card has driven much of the increase seen in recent years.
In 2013 there were 30.1 million credit and charge card holders, equating to around 60% of all UK adults.
Credit cards were used for 42 purchases on average in 2013, with the typical transaction valued at £69.49.
Over 80% of all credit and charge card spending in 2013 was made by cardholders who repaid the balance in full. The report said that in a reflection of people's desire to pay down debt where they can in tough economic times, outstanding borrowing on credit cards has fallen by 15.6% from a monthly average peak of £67.4 billion in 2005 to £56.4 billion in 2013.
The annual value of card payments is expected to lift from £520 billion last year to around £874 billion in 2023. This figure is expected to be boosted by card use by young adults who have grown up with debit cards, the growth in technology such as contactless payments and the rise in internet shopping, which often involves payments being made by debit card.
A report released by the British Retail Consortium (BRC) this week also suggested that advances in technology are prompting consumers to take their plastic out of their wallets to pay on occasions where they may have previously used cash.
Contactless "tap and go" debit card payments allow people to make payments of up to £20 at the tillpoint simply by swiping their card on a reader.
Around 7.2 million contactless cards were issued in 2013 to leave the year-end total at 38 million. Major merchants which now accept contactless payments include Marks & Spencer, Greggs, Boots, Aldi, Lidl, Starbucks and Costcutter.
Melanie Johnson, chairwoman of the UK Cards Association, said: "With three in every four pounds spent in British shops now paid with cards, these figures reveal a huge shift over the last decade in the way we chose to transact.
"Rather than carrying cash, consumers are increasingly opting for their cards instead, not least because of the extra protections available.
"The rise in online shopping, coupled with increasing momentum behind contactless cards, will likely see this trend in consumer behaviour continue."