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Report
2018 Survey of Consumer Payment Choice
In 2018, U.S. consumers made 72 payments per month on average, not a significant change from 2017.As in 2017, the most frequently used payment instruments were debit cards (34 percent of alltransactions), cash (24 percent), and credit cards (23 percent). Over the 11 years of the survey, debit,cash, and credit have consistently been the most popular ways to pay. For the first time in 2018, debitcards replaced cash as the payment instrument used most frequently for in-person purchases.Some key findings about medium-term trends from 2015 to 2018 include the following:• The share of consumers ...
Report
The 2012 diary of consumer payment choice
This paper describes the results, content, and methodology of the 2012 Diary of Consumer Payment Choice (DCPC), the first edition of a survey that measures payment behavior through the daily recording of U.S. consumers? spending by type of payment instrument. A diary makes it possible to collect detailed information on individual payments, including dollar amount, device (if any) used to make the payment (computer, mobile phone, etc.), and payee type (business, person, government). This edition of the DCPC included about 2,500 participants and was conducted in October 2012. During that month, ...
Briefing
What Two Billion Retail Transactions Reveal about Consumers’ Choice of Payments
Although cash continues to be a major form of payment in retail transactions, data on the use of cash are challenging to obtain. Research at the Richmond Fed has exploited a large dataset of cash, check, credit card, and debit card transactions at a nationwide retail chain to examine consumer payment choice based on transaction size and location, day-of-week and day-of-month cycles, and longer-term trends.
Report
The 2016 and 2017 surveys of consumer payment choice: summary results
Despite the introduction of new technology and new ways to make payments, the Survey of Consumer Payment Choice (SCPC) finds that consumer payment behavior has remained stable over the past decade. In the 10 years of the survey, debit cards, cash, and credit cards consistently have been the most popular payment instruments. In 2017, U.S. consumers ages 18 and older made 70 payments per month on average. Debit cards accounted for 31.8 percent of those monthly payments, cash for 27.4 percent, and credit cards for 23.2 percent. The SCPC continues to measure new ways to shop and pay and found ...
Report
The 2015 Survey of Consumer Payment Choice: summary results
The 2015 Survey of Consumer Payment Choice (SCPC) was implemented using a new longitudinal panel, the Understanding America Study (UAS), and results are not yet comparable to the 2008?2014 SCPC. In 2015, U.S. consumers made 68.9 payments per month. Debit cards remained the most popular payment instrument among U.S. consumers in 2015, accounting for 32.5 percent of their monthly payments, followed by cash (27.1 percent) and credit or charge cards (21.3 percent). For nonbills, consumers used cash and debit equally?about one-third of the time for each. For bills, consumers used payment cards for ...
Report
Liquidity, Collateral Quality, and Negative Interest Rate
We analyze how banks manage liquidity between cash and marketable securities and its impact on the refinancing of projects subject to a liquidity shock. Securities can be pledged as collateral to acquire additional cash but are an imperfect hedge because their quality is uncertain. We show that banks may hold too much or too little cash in equilibrium compared to the first-best level, depending on the dispersion of securities value. Furthermore, the equilibrium relationship between the dispersion and banks cash holding is non-monotonous. We use this framework to assess the impact of liquidity ...
Working Paper
Payments Evolution from Paper to Electronic Payments by Merchant Type
The use of paper instruments—cash and checks—has been declining in the United States, and consumers have been gradually replacing paper with cards and electronic payments. Stavins (2021) examines the evolution of payments from paper to cards and electronic payments, while Shy (2020) shows the payments landscape across merchant types. This paper combines the cross-sectional analysis across merchants with the aggregate time series study to analyze the evolution of consumer payments by merchant type. Using data from a representative diary survey of US consumers collected annually over the ...
Report
The 2016 Diary of Consumer Payment Choice
This paper describes key results from the 2016 Diary of Consumer Payment Choice (DCPC), the third in a series of diary surveys that measure payment behavior through the daily recording of U.S. consumers? spending. In October 2016, consumers paid mostly with cash (31 percent of payments), debit cards (27 percent), and credit cards (18 percent). These instruments accounted for 76 percent of the number of payments, but only 34 percent of the total value of payments, because they tend to be used more for smaller-value payments. Electronic payments accounted for 43 percent of the value of payment ...
Discussion Paper
Consumer Behavior in a Health Crisis: What Happened with Cash?
In the United States, COVID-19 cases and currency in circulation both surged in March 2020. Did consumer choice play a role in the increase in currency in circulation? With fewer opportunities to shop and pay in person, why would consumers hold more cash? Data from the fall 2019 Survey and Diary of Consumer Payment Choice and interim rapid-response surveys in spring and late summer 2020 give some insights into consumer cash holdings and payments behavior.
Report
Dealers and the Dealer of Last Resort: Evidence from the Agency MBS Markets in the COVID-19 Crisis
When market disruptions started in March 2020, dealers maintained the usual liquidity provision in the agency MBS market by taking cash inventory and hedging inventory risk with forward contracts. However, cash and forward prices significantly diverged and began to converge only after the Federal Reserve deployed nonstandard purchase operations to promptly take MBS off dealers’ balance sheets. Further cross-dealer analyses point to supplemental leverage ratio requirements as major constraints on dealers’ balance sheets. Customers’ selling increased when price divergence reverted, ...