UK consumers will spend £18.5bn a year on the internet by 2010 – money that would otherwise be spent in high-street stores, according to new research by PayPal.

The online payment company predicts that there will be almost 25m UK consumers shopping online by this date – an increase of 10m in the next five years.

The average spend per online transaction is also expected to rise, reaching £48.

According to PayPal, food and grocery shopping will increase by 235% from last year to account for almost 30% of the total online retail marketing 2010.

It believes that clothing and footwear category will be worth £2.27bn – an increase of 160%.

Chief executive of PayPal Europe Geoff Iddison, said: “Over the past few years we've seen the internet gradually eating away at the high street. By 2010, however, we expect substantial sums that would have been spent on the high street to move online.

“Our predictions are that more and more consumers will turn their backs on the high street and shopping centres in favour of the convenience of buying from home.”

PayPal allows businesses and consumers with a valid email address to make secure online payments.