Report

Payment Instrument Adoption and Use in the United States, 2009-2013, by Consumers' Demographic Characteristics

Abstract: Previous literature, based on data from a single time period, has shown that consumer payment behavior is correlated with income and demographic characteristics. Using data from five consecutive annual consumer surveys from 2009 to 2013, we confirm a strong cross-sectional relationship between demographics and payment behavior, but we observe few significant changes in payment behavior over the five-year period. This suggests that payment behavior evolves slowly over time. Age, education, and income are especially strongly correlated with both adoption and use of most payment instruments, while race is strongly correlated with use. Cash is used most heavily by young, black, least-educated and lowest-income consumers, while credit cards are used mostly by older, wealthier, and moreeducated individuals. None of the education or income disparities observed diminished during the five-year period covered by our sample.

JEL Classification: D12; D14;

Bibliographic Information

Provider: Federal Reserve Bank of Atlanta

Part of Series: Consumer Payments Research Data Reports

Publication Date: 2015-10-19

Number: 2015-06