FedNotes
This publication offers key insights and observations into the Federal Reserve System's cash practices, policies, and strategic direction.
2023
2023 Findings from the Diary of Consumer Payment Choice
Posted May 5, 2023
The 2023 Diary of Consumer Payment Choice finds that that 2020’s shift away from cash and toward credit card payments has continued. Consumers continued to reach for credit cards at a higher rate in 2022. Their use of on-line payments also remained elevated as compared to pre-pandemic payment habits. By contrast, consumer use of debit cards and cash held steady at 2020 levels. These are some of the prominent findings from the most recent consumer survey conducted by Federal Reserve Financial Services.
2022
2022 Findings from the Diary of Consumer Payment Choice
Posted May 5, 2022
The 2022 Diary of Consumer Payment Choice finds that the COVID-19 pandemic has continued to affect the way U.S. consumers use and hold cash. The share of payments made in cash dropped sharply from 2019 to 2020 and then increased slightly in 2021, implying that cash use hit its lowest point in the first pandemic year. In contrast to cash use, consumers’ cash holdings remained elevated in 2021 when compared to 2019 and prior years, indicating that consumers continued to demand cash in the uncertain environment of the pandemic’s second year. These are some of the prominent findings from the most recent consumer survey conducted by Federal Reserve Financial Services.
2021
Consumer Payments and the COVID-19 Pandemic: Findings from the April 2021 Supplemental Survey
Posted September 21, 2021
Consumers continue to hold more store of value cash in their home, car, or elsewhere than compared to pre-pandemic levels. Additionally, consistent with the findings in the April and August 2020 supplemental surveys, fewer consumers are making in-person payments compared to pre-pandemic levels. The share of individuals making in-person payments and using cash in April 2021 declined slightly to about 60 percent, down 15 percentage points from August 2020. These are some of the prominent findings from the most recent consumer survey conducted by the Federal Reserve System’s Cash Product Office (CPO) and the Federal Reserve Bank of Atlanta.
2021 Findings from the Diary of Consumer Payment Choice
Posted May 5, 2021
Consumers made fewer payments, specifically fewer small-value payments in 2020 compared to 2019. Additionally, while in-person payment dropped by 19% compared to the 2019 Diary, total spending for not-in-person, non-bill payments increased substantially at grocery stores, dining establishments, and general merchandise locations. The total value of not-in-person spending also doubled in 2020. These are some of the prominent findings from the most recent consumer survey conducted by the Federal Reserve System’s Cash Product Office (CPO) and the Federal Reserve Bank of Atlanta.
Consumer Payments and the COVID-19 Pandemic: The Second Supplement to the 2020 Findings from the Diary of Consumer Payment Choice
Posted February 9, 2021
A majority of consumers continued to increase the amount of cash they are carrying and/or storing, while nearly 80% of respondents who made in-person purchases did not indicate that they were avoiding or averse to using cash during the COVID-19 pandemic. These are two prominent findings from the most recent consumer survey conducted by the Federal Reserve System’s Cash Product Office (CPO) and the Federal Reserve Bank of Atlanta.
2020
Consumer Payments and the COVID-19 Pandemic: A Supplement to the 2020 Findings from the Diary of Consumer Payment Choice
Posted July 31, 2020
In the 2020 Findings from the Diary of Consumer Payment Choice, data from October 2019 show that consumers used cash for 26 percent of all payments, and that it is used for nearly 47 percent of payments under $10. To gain an understanding of how the COVID-19 pandemic is impacting consumers’ payment choices, the Federal Reserve conducted a supplemental Diary survey from April to May 2020, which provides initial insight into how payment behavior is evolving in the midst of the crisis.
2020 Findings from the Diary of Consumer Payment Choice
Posted July 31, 2020
In its sixth iteration, the Diary of Consumer Payment Choice data show that consumers used cash for 26 percent of all payments, and that it is used for nearly 47 percent of payments under $10.
2019
Cash Me If You Can: The Impacts of Cashless Businesses on Retailers, Consumers, and Cash Use
Posted August 19, 2019
Cashless coffee shops, restaurants, and convenience stores have popped up across the country. It is not illegal to refuse cash as a form of payment in most states and cities in the U.S., and going cashless helps these businesses eliminate the costs of handling and transporting cash. But do these savings come at the cost of financial inclusion? This paper explores the impacts of businesses going cashless.
2019 Findings from the Diary of Consumer Payment Choice
Posted June 26, 2019
In its fifth iteration, the Diary of Consumer Payment Choice data show that cash continues to be used extensively for small-value purchases – representing nearly half of all payments under $10 and 42 percent of payments less than $25. However, consumers’ use of other payment options, including debit and credit cards, is growing.
2018
2018 Findings from the Diary of Consumer Payment Choice
Posted November 15, 2018
This paper explores how often U.S. consumers spent and held cash during the 2017 Diary of Consumer Payment Choice survey. Data from 2017 show that cash continues to be the most frequently used payment instrument, representing 30 percent of all transactions and 55 percent of transactions under $10.
2017
Understanding Consumer Cash Use: Preliminary Findings from the 2016 Diary of Consumer Payment Choice
Posted November 28, 2017
Data from the Federal Reserve’s Diary of Consumer Payment Choice shows that cash remains the most used payment instrument in 2016 accounting for 31 percent of all consumer transactions. This study provides a unique view into consumer shopping and payment decisions, including their use of cash.
Cash Holdings: A New View on Cash
Posted June 28, 2017
As new payments and technologies continue to emerge, cash retains a strong hold among consumers. This paper explores how often U.S. consumers held and spent cash during the 2015 Diary of Consumer Payment Choice survey, and it provides an analysis on consumers’ cash holding behavior.
2016
The State of Cash: Preliminary Findings from the 2015 Diary of Consumer Payment Choice
Posted November 3, 2016
As the payments landscape continues to evolve, cash remains a resilient payment instrument. The Diary of Consumer Payment Choice is one of the Federal Reserve’s primary data sources on consumer payments, and insights from the Diary provide an outlook on how consumers use cash compared to other payment instruments. When first conducted in 2012, Diary results showed that cash was the most frequently used payment instrument and its use was prevalent across all demographic groups. This paper focuses on findings and insights from the 2015 Diary and how they compare to the earlier research.
Shopping Experience Trends and their Impact on Cash
Posted April 26, 2016
The way consumers shop today is much different than ten years ago, largely due to the proliferation of new technologies like smartphones and tablets. Today’s new methods of shopping often blur the line between “in-person” and “online” purchases and influence how consumers choose to pay for their purchases. This paper identifies five themes that describe today’s shopping experience and how this new experience may impact cash’s position in the payment landscape.
2015
Who Holds Cash? Evidence from the 2012 Diary of Consumer Payment Choice
Posted December 31, 2015
In an evolving payments landscape where card use continues to grow and occasionally cash is not a payment option, this paper explores segments of the population that resist cash’s alleged decline and continue to carry cash.
2014
Consumer Preferences and the Use of Cash: Evidence from the Diary of Consumer Payments Choice – Working Paper
Posted July 21, 2014
With the increase in electronic payments, it has been difficult to determine how personal preferences impact the demand for cash as a payment instrument. By analyzing data on demographics and stated payment preferences, this FedNotes paper provides evidence on the determinants of cash usage for small value payments, and particularly how consumers’ stated payment instrument preference and the amount of the purchase affect their propensity to use cash.
Cash Continues to Play a Key Role in Consumer Spending: Evidence from the Diary of Consumer Payment Choice
Posted April 29, 2014
It’s commonplace these days to predict the demise of cash. However, evidence from the Diary of Consumer Payment Choice (DCPC) suggests that consumers choose to use cash more frequently than any other payment instrument, including debit or credit cards. Cash plays a dominant role for small-value transactions, is the leading payment instrument for many types of purchases, and stands as the key alternative when other options are not available. Using the DCPC data, this FedNotes paper explores where, how, and why people use the various payment options and highlights the key and enduring roles cash continues to play in consumer transactions.
Trends in Retail Cash Automation: A Market Overview of Retail Cash Handling Technologies
Posted March 14, 2014
Until recently, cash handling has been largely a manual and labor-intensive process. However, this has begun to change with new devices that automate certain back office cash handling functions, such as cash dispensers, recyclers, and smart-safes. Because cash usage remains strong, merchants, banks, and armored carriers are exploring ways to take advantage of these new technologies to automate their cash handling functions. This FedNotes paper provides an overview of cash handling in the financial and merchant environments, along with how these new devices are being used.
2013
Maintaining a Robust and Efficient Cash System in a Changing Landscape
Posted August 20, 2013
The role of paper currency in the U.S. economy is changing. While the share of payments made with cash appears to be falling, cash continues to be used widely and plays an important function as a store of value, domestically and internationally. Cash also serves an enduring role in natural or other disasters when other payment systems may not be available. These factors suggest that cash will continue to be an essential and significant part of the payment and financial system for the foreseeable future.