Consumers wrote nearly two-thirds fewer cheques per household in 2015 than in 2000, while total non-cash payments per household, which includes cheques, card payments and electronic transfers via automated clearing house (ACH), expanded almost 95%, according to additional results released 30 June from the US “2016 Federal Reserve Payments Study”.

Banking Technology‘s sister publication Paybefore reports that while the numbers are encouraging to those facilitating electronic payments, prepaid providers have some work to do to gain market share.

The number of cheques written per household fell from 19.3 per month in 2000 to 7.1 in 2015, while total non-cash payments increased from 40.3 to 78.6 per month, reflecting fundamental shifts in consumer behaviour such as changes in shopping, purchasing and bill payment habits, according to the Federal Reserve. At the same time, businesses also increasingly replaced cheque payments with other non-cash payments.

The information supplements initial results released last December. The report also contains data on major trends in payment card, ACH and cheque payments, as well as alternative payment initiation methods and services, from 2012 to 2015. Highlights include:

  • The aggregate ranking in 2015 of the number of non-cash payments by payment type differed substantially for consumers and businesses. The use of non-prepaid debit cards was the most popular payment type among consumers, followed by general-purpose credit cards, cheques and ACH debit transfers.
  • For businesses, ACH credit transfers were the most popular, followed by cheques, general-purpose credit cards and non-prepaid debit cards.
  • Growth in selected alternative payment initiation methods and services, such as payments initiated via a mobile device, payments made through specialised services for person-to-person payments, and payments using online payment authentication methods, was strong from 2012 to 2015. Compared to the total number and value of non-cash payments, however, the total number and value of payments using these methods remains low.

The Federal Reserve now is collecting information on the number and value of non-cash payments made during 2016 as part of a smaller and more targeted data collection effort intended to allow for annual updates to estimates and trends in non-cash payments between the major studies, which are published every three years. The annual supplement is expected to be released in the fourth quarter of 2017.

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