Cash used to be king — now? As reported by the Federal Reserve Bank of San Francisco (FRBSF), in 2012, cash represented 40 percent of U.S. consumer spending. By 2016, this figure had fallen to 31 percent. Furthermore: “Most consumer payments are for small transactions. About 60 percent of in-person payments under $10 are made in cash, compared to 20 percent of in-person transactions for $25 or more.” As online and mobile shopping grow, cash use will drop even further.
Firms of all types and sizes need to aware of these trends. AND plan accordingly.
Cash Used to Be King — Now?
Consider these FRBSF infographics.
(1) Estimated aggregate volume and value shares of all payments (including bill payments and non-bill payments). Includes cash, check, credit cards, debit cards, other electronic payments made through bank accounts, and other payments
(2) Cash used most often for payments less than $25. Credit and debit cards used more often for amounts between $25 and $100. Checks and electronic payments used more often for amounts of $100 and over.
(3) Greater reliance on cash by households with an annual income of less than $50,000 per year.
(4) Those under 35 years-of-age less apt to use cash than those over 35.