• d prepaid): 57 percent, or 20 payments per month in 2020. 

• Also last year, 31 percent of all payments per month were executed using electronic devices; 14 percent of all bill settlements were made using a mobile phone.

According to a recently published study by the U. S. Federal Reserve Bank of Atlanta, Georgia, debit cards and credit cards are the most commonly used payment instrument by number for purchases among U. S. consumers. Electronic methods linked to a bank account are used for almost half of bill payments by number. 

In the pandemic year 2020, online or mobile purchases of goods and services in the U. S. increased to 24 percent of all purchases (as a share of in-person and not-in-person) from 17 percent. Of acquisitions not made in person, forty percent were accomplished via a smartphone.

The analysis “The 2020 Diary of Consumer Payment Choice” by the U. S. Federal Reserve Bank of Atlanta, Georgia, also revealed that debit cards and credit cards are the most commonly used payment instrument by number for purchases among U. S. consumers, accounting for about one-third of purchases each.

Irreversible trend

Marianne Bregenzer, CEO of cashless pay-tech provider Nets Switzerland SA, said: “The trends in the world’s biggest economy towards non-cash, contactless methods of payments show that there is no ‘return to normal’ or a pre-pandemic love for cash: cashless s the new normal.”

U.S. consumers made more than half of their payments with payment cards (debit, credit, and prepaid): 57 percent, or 20 payments per month in 2020. Also last year, 31 percent of all payments were executed using electronic devices; 14 percent of all payments per month were made using a mobile phone.

Compared with 2019, the volume shares of cards and electronic instruments increased and the volume shares of paper instruments declined; only the decline in the share of payments per month made by paper instruments is statistically significant. The study does not reveal the share of virtual cards (credit or debit cards not out of plastic but only existent online on the PC, tablet, or smartphone) which have been on the rise in the wake of the pandemic. 

Nothing alchemist

Of the average 35 payments per month that U.S. consumers reported, 12 were for everyday purchases (groceries, pharmacies, stores, and online shopping); six were for food consumed away from home (including restaurants, bars, and fast food, down from eight in 2019); three were at petrol stations; and three were related to financial services companies (including insurance; IRA and mutual funds; credit card, mortgage, and other loan payments).

Ms Bregenzer: “Kissing cash good-bye is not dedicated to youngsters alone – it is a phenomenon visible across the generations.”

“Although cards were used more frequently than electronic payments, the total value of payments made electronically exceeded that of payments within every four weeks made by cards: $1,476 compared to $1,269”, said the study. In relation to value, payments using electronic instruments were 34 percent of the monthly total, compared to 29 percent for cards and 27 percent for paper instruments. “None of the changes in share by dollar value were statistically significant.”

Debit cards, cash, and credit cards remain the ways to pay used most often, 6 with debit cards used most by number of payments. Twenty-eight percent of payments per months were with debit cards, 27 percent with credit cards, and 19 percent with bank notes. 

Digital lion’s share 

In order to sum these observations up, consumers made 75 percent of their payments using debit cards, cash, and credit cards. The distribution by value is different. Cash, debit, and credit payments accounted for 34 percent of the value of their payments per month: 6 percent in cash, 12 percent in debit cards, and 16 percent in credit cards. “The difference between the distribution by volume and by value reflects that consumers tend to use cash and payment cards more often, but for relatively low-value payments, and they tend to use checks and electronic payments less often, but for relatively high-value payments.” 

For example, U.S. consumers on average made fewer electronic-instrument payments per month than cash settlements (four compared with seven), but they used electronic payments for settlements that were higher in average value than cash settlements ($350 compared with $42). The average value when using payment cards fell between the two, at $64. ***