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Insider’sreport

on payments

Check usage down; ACH, card payments up

By Patti Murphy be used for one-time payments. In either scenario, the
ProScribes Inc. consumer (or business payer) authorizes the payee's bank
to pull funds from their bank account for crediting to the
heck usage has plummeted, while card and payee's account. This differs from common ACH credit
automated clearing house (ACH) payments applications (like direct deposit) where the paying party
continue to grow. That's the top line finding instructs their bank to push funds to the payee's bank
C disclosed by the latest Federal Reserve report account.
on noncash payments. The Fed collects data on noncash
payments (checks, credit and debit cards and ACH) ACH credits and debits, combined, grew 6.0 percent a year
through ongoing research projects, and publishes a com- between 2015 and 2018, while the value of ACH payments
prehensive report on its findings every three years. The grew 7.2 percent a year. In all, the ACH was used to move
latest report, detailing noncash payment trends between 28.5 billion transactions with a combined value of $64.16
2015 and 2018, was published in December 2019. trillion in 2018, compared to 23.9 billion transactions
worth $52.08 trillion three years earlier.
In 2018, Americans made 174.2 billion noncash payments,
an increase of 30.6 billion over 2015. The value of noncash The number of checks that cleared through the banking
payments in 2018 totaled $97.04 trillion, a $10.25 trillion system fell 7.2 percent a year between 2015 and 2018,
increase over 2015, the Fed reported. By number, the representing a much steeper rate of decline than the 2.8
growth rate of noncash payments was 6.7 percent a year percent a year during the previous survey period. And in
between 2015 and 2018, outstripping the 5.1 percent annual a reversal of the upward trend in check values registered
growth rate charted between 2012 and 2015. By value, between 2012 and 2015, the total value of check payments
the 3.8 percent a year growth rate in noncash payments fell 4 percent a year from 2015 to 2018, the Fed said. The
during that period was slightly higher than the previous 14.5 billion checks written in 2018 carried a total value of
three year period (3.6 percent per year). $25.80 trillion.
More debit card use, credit card dollars
Excluding checks, growth in noncash payments
outstripped growth in U.S. gross domestic product for Debit card usage has taken off in recent years, although
the three years studied. In 2018, for example, GDP was 2.9 credit cards are preferred for higher-value purchases.
percent. GDP was 2.6 percent in 2017 and 1.6 percent in Taken together, card payments charted the fastest growth
2016. of all noncash payments between 2015 and 2018: 8.9 percent
a year by volume and 8.6 percent by value. A total of 131.2
Comparing usage by payment type, it's clear U.S. billion card transactions valued at $7.08 trillion were made
consumers are shunning checks in favor of electronic in 2018, the Fed reported. At $54, the average value of card
alternatives, particularly debit cards and ACH debits. In payments in 2018 was on par with the average in 2015, the
fact, at 16.6 billion, there were more ACH debit transfers Fed said.
in 2018 than there were check payments (14.5 billion). This
was a first in the history of the ACH, which was created Not included in these totals are 5.1 billion ATM
nearly 50 years ago as an electronic alternative to paper withdrawals valued at $800 billion made in 2018,
checks. Twenty years ago, checks outnumber ACH debits representing slight decreases from 2015. The average value
by 21 to one (42.6 billion checks to 2.1 billion ACH debits). of ATM withdrawals grew, however, from $146 in 2015 to
$156 in 2018.
Debits are the ACH transaction type that most closely
resemble checks, and are often used to support automated Here's a rundown of key data points regarding credit and
consumer online bill payments, although they also can debit card payments.

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