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Survey: Check Usage Has Plummeted in Past Two Decades; Cash Usage is Way Down Since 2017

S.J. Steinhardt
Published Date:
Sep 15, 2023

GettyImages-928077630 Check Payment

Will that be cash or check? Increasingly, neither.

Six in 10 payments of noncash purchases, gifts and bills were made by check as recently as 2000, but that number is now one in 20, The Washington Post reported.

Noncash payment methods for business and personal transactions are now made overwhelmingly by debit cards, $87.88 billion in 2021, followed by credit cards, at $51.1 billion, the Post reported. Checks were the least popular form of these payments in that year, at $11.2 billion.

As recently as 2003, the Federal Reserve ran 45 check-processing locations. A decade later, it was operating just one, in Atlanta. As check usage fell, the Fed transitioned to a largely electronic system, and checks were also processed faster.

“[People were] caught off guard by the rate at which check-writing dropped off the map,” said Kevin Foster, survey director at the Atlanta Fed, which measures Americans’ spending habits. “We don’t want to be caught off guard the same way with cash!”

Cash was still the preferred payment method as recently as 2017, until it was supplanted by the debit card two years later. It plummeted in use during the pandemic and accounted for 17 percent of all payments as of 2022. Credit cards accounted for 31.2 percent and debit cards, whose use peaked in 2019, accounted for 29 percent. The Post added that payment apps such as Venmo and Zelle remain a minor part of Americans' financial transactions, yet their use expanded rapidly during the pandemic and remain elevated.

The Post found that three-quarters of retirement-age Americans still use checks, compared with fewer than a tenth of college-age Americans. Check use is also higher among those with more education and higher earnings, regardless of age.

The data also indicated that check usage is most common in the great Pacific coast and the Midwest, and lowest in the East and the South.

The survey further discovered one factor that transcended age, income, education and geography in terms of check usage: ethnic heritage. Fifty-one percent of white people have written a check in the past month, compared to 31 percent of Hispanic Americans and 37 percent of Asian Americans. Fewer than one quarter of Black people have done the same.

The latter could be attributable to Black people being five times less likely to have a bank account than their white peers in 2021, according to the Federal Deposit Insurance Corporation (FDIC), and to one in 10 Black households remaining unbanked.

Forty-six percent of Black people who applied for credit in 2021 were either denied or approved for less than they requested, compared to 22 percent of white people, according to a Federal Reserve survey.

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