Despite rise of digital options, cash usage continues unabated

Consumers still like to pay with cash, about one in seven times a month, despite the proliferation of digital options. This is according to the Federal Reserve's recently released 2026 Diary of Consumer Payment Choice.

The annual survey, now in its tenth year, revealed that cash usage has been holding steady for the past three years as the third most-used payment instrument consumers reach for. Credit and debit cards are used for about two-thirds of consumer payments, the Fed study found.

In all, consumers participating in the study made an average of 47 payments per month in 2025. Sixteen payments were made using credit cards, 15 with debit cards, six with cash, six via the ACH, and four by mobile app or other means (for example, check).

Cash stable amid digital rise

The findings continue to demonstrate more gradual shifts in consumer habits when compared to advancements in payment technologies and increased payment options, the Fed observed. Most consumers (76 percent) carried cash in their pockets, purses or wallets in 2025, with the average amount being $69. Nearly half (45 percent) stored an average of $364 in cash elsewhere for savings or emergency purposes.

Four out of five consumers surveyed had used cash in the 30 days leading up to the Fed's survey, and 90 percent said they planned to continue using cash in the future.

"The consistency of cash and card use over the last three years suggests cash remains a stable payment method amid the rise of digital options," said Kathleen Young, executive vice president and chief of FedCash Services. "Cash continues to remain a primary method for some, while serving as a backup payment option and store of value for many Americans."

In recent years, consumer preferences for in-person payment methods have stabilized, the Fed reported, although the survey also revealed noticeable shifts over the past decade. More consumers now say they prefer using credit cards in person (38 percent compared to 24 percent in 2016), nearly equal to the amount who say they prefer to use debit cards (40 percent).

Generational, demographic differences

The survey also revealed generational and demographic trends in payment choices. Households earning less than $25,000 a year and adults 55 and older relied more on cash than other folks. Rural residents were more likely to use cash than their urban and suburban counterparts: they reported an average of nine cash payments a month, compared to six cash payments made by consumers in suburban and urban areas.

The Fed has been conducting an annual survey of consumer payment choice since 2016 in order to get a handle on consumer habits. Participants are asked to report all payments over a three-day period, the value of their cash holdings, payment instruments used and their preferences for various types of payments.

They are also asked to report the amount of cash on hand after each survey day, cash stored elsewhere, and cash deposits or withdrawals. This latest survey was conducted in October 2025.

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