Electronic payments overtake cheques and cash in the US

Electronic payments overtake cheques and cash in the US

For the first time, electronic payments have surpassed cash and cheques as the preferred payment method for US consumers when shopping on the high street, according to a nationwide study conducted by the American Bankers Association and Boston-based strategy consulting firm Dove Consulting.

The 2003/2004 study, conducted among 2008 US consumers, found that cash and cheques now account for 47% of in-store purchases, as compared to 57% in 1999 and 51% in 2001.

Much of the slack appears to be taken up by growth in debit cards, which now account for nearly one-in-three instore purchases, up from 21% four years ago.

While cash remains the single most frequently used payment method on the high street, its share of the transaction mix has fallen from 39% in 1999 to 32% in 2003. Checks also play a diminishing role at the point-of-sale, accounting for just 15% of purchases.

Comparatively, consumer use of credit cards for in-store purchases has remained relatively constant at 21%. At two percent, the "other" payments category is made up of prepaid cards.

The study finds cheque usage is also on the wane for bill payments, falling from 72% in 2001 to 60% today, with online bill payment gaining in popularity. The survey finds 41% of consumers currently use online bill payment to settle recurring bills.

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