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billion, or nearly 24 percent. (The Fed lumped together
Insider’sreport credit, debit and prepaid card payments into one master
category for this report.)
on payments Even with the increase in CNP transactions, the overall

number of card payments fell 0.39 percent in 2020, the
first time a decline was recorded since the Fed first began
tallying totals, in 2000. Also, for the first time the value of
CNP transactions ($3.85 trillion) exceeded the total value
CNP, ACH payments of in-person transactions ($3.20 trillion) in 2020. The all-
time peak for in-person card payments ($3.51 trillion) was
gain – crypto too back in 2019.

Despite the decline in number, cards remain the most
By Patti Murphy popular form of noncash payment used by U.S. consumers,
the Fed said. Consumers made 124.4 billion credit, debit
ProScribes Inc. and prepaid debit card payments in 2020; 79.4 billion in
person and 45.0 billion CNP.
s we approach the three-year mark in the
COVID-19 pandemic, it's clear that consum- Checks saw the biggest use losses, falling from 8.55
er shopping and payments preferences have percent of all noncash payments in 2018 to 6.51 percent
A changed significantly. Trends like contactless in 2020. The total number of commercial checks fell 14.2
and mobile, once also-rans in the race to merchant check- percent, "substantially faster by number and value in 2020
outs, are making real inroads. And while consumers may compared to other recent years," the Fed wrote.
be making fewer purchases with cards and mobile wallets,
average tickets are growing. Kickstarting P2P, digital wallets

Last month the Federal Reserve released an update to The pandemic also helped to spur growth in emerging
its oft-quoted payments study. Among the findings: payment form factors, like in-person contactless cards,
consumers are using their credit and debit cards less than digital wallets and person-to-person payments, the Fed
before the pandemic, but when they do, they tend to spend noted. But overall numbers for these payment types still
more. pale in comparison to traditional card payments.

The Fed also found that the automated clearing house was Contactless card payments were up a whopping 172.3
the only core payment system to see transaction numbers percent in 2020, to total 3.7 billion. By value, contactless
grow in 2020. More recent data provided by Nacha shows card payments totaled $110 billion in 2020, compared to
that through the third quarter of 2021 there were 21.7 $20 billion in 2019.
billion ACH payments, an increase of 9.6 percent over the Digital wallet card payments also grew significantly from
same period of 2020. This included a 73 percent increase in a rather small base. Credit and debit card payments made
same-day ACH payments. using digital wallets represented 2.6 percent of all card
payments in 2020, and 1.47 percent of total value. Financial
Historically, ACH payments have taken two days or institutions also saw 11.5 percent growth in the number of
more to clear and settle, but recent rule changes support accounts accessible using digital wallets.
settlement of transactions up to $100,000 on a same-day The crypto factor
basis; in March the threshold rises to $1 million.
A recent phenomenon not covered by the Fed's report,
Huge shifts to CNP, ACH but available from other sources, points to emerging
The Fed regularly collects data from large financial consumer demand for paying with cryptocurrency. Make
institutions and payment networks to gauge usage no mistake, cryptocurrency payments are coming to the
of various noncash payment types, and publishes a POS. They may plod along, like mobile and contactless did
comprehensive payments study every three years in the past, but for a much briefer period.
detailing findings. The most recent study covered 2019
and was released at year-end 2020. Between reports, the Consumers already have access to crypto-linked cards.
Fed publishes updates; the latest of these covers 2020. Visa reported more than $1 billion was spent using
crypto-linked Visa cards in the first half of 2021; by early
According to the update, 2020 brought "an unprecedented November that total had climbed to $3.5 billion, according
decline" of 11.5 billion in card-present payments. That to the website TechCrunch.
amounts to a 13 percent increase over 2019. Card-not-
present transactions rose "a similarly unprecedented" 8.7 A new study by CITE Research for the digital payments
company Cantaloupe revealed that two-thirds of
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