The latest Consumers Payment study published by the Federal Reserve Bank of Boston finds that debit cards are the most popular payment type, making an average of almost 32 percent of their payments with a debit card, followed by cash (27%) and credit card or charge payments, representing an average of 23% of all payments in a typical month. Consumers’ transactions remain primarily in stores despite the growth of online or mobile commerce, as online purchases rose to an average of 8 percent of each consumer’s total transactions in 2017, a statistically significant increase compared to the findings from 2015.
The percentage of cash and debit payments have stayed largely the same since the end of 2015, while credit card payments are up about 2 percent. By mode, card payments were more popular than paper or electronic payments in 2017. In a typical month, consumers made an average of 40 payments using debit, credit, or prepaid cards (57.1 percent of total payments); 23.4 payments using cash, paper checks, and other paper 13 instruments (33.6 percent); and 5.8 payments using electronic and other means of payment (8.3 percent).
Our latest Customer Merchant Experience report on the merchant experience reinforces this study’s findings that in-store experiences remain the focus of the bulk of everyday shopping, but it is increasingly important to blend with online and mobile shopping as aids, even when shopping in stores.
It is also important to note that this Consumer Payments study published by the Federal Reserve Bank of Boston tracks frequency of transactions and mode, which as you see are different metrics. Our CustomerMonitor Survey Series Payments survey shows that debit cards (44%) followed by credit cards (42%) and then cash (31%) are consumers’ preferred payment methods in stores. At online retailers, credit cards are preferred over debit cards and online payment services such as PayPal are also more important in online channels.
Overview by Karen Augustine, Manager Primary Data Services at Mercator Advisory Group