Cash Continues to Keep Spot as Top Payment Method for Small Purchases, Report Finds
8-19-2019
A new report from creditcards.com has found that consumers prefer to use cash for purchases under $10, despite the proliferation more convenient digital payment methods like contactless cards and mobile payments.
According to the study, which polled 2,544 American adults via an online survey in July 2019, 49 percent of consumers usually pay tabs under $10 with cash, whereas 35 percent usually pay with debit cards and 16 percent with credit cards.
Rewards cards increased usage among consumers. Forty three percent of consumers with rewards cards said they preferred cash, 31 percent debit and 26 percent credit.
The report also found that 39 percent of reward card holders have used mobile payments, and 14 percent have used a contactless card. Over half of surveyed rewards card holders said they didn’t have a contactless card. Unsurprisingly, mobile payments are more popular among younger consumers. Among millennials with rewards cards, 61 percent said they’ve used mobile payments. That’s significantly more than both Gen-Xers and Baby Boomers, at 44 percent and 24 percent respectively.
The report also found that higher earnings correlated with less cash usage for small purchases. While high earners – those making salaries of $80,000 or more – still use cash the most, they’re more likely than all other income groups to use credit cards for small purchases.
Respondents generally felt that cash and debit payments were faster and easier – only 24 percent of consumers with rewards cards said they avoided credit cards due to concerns over debt.
Contactless cards and mobile payments offer consumers faster and more secure payments options, particularly for low-value transactions. Read more about contactless payments and the benefits they provide merchants in this piece by the ETA Communications Committee.
Read the full report from creditcards.com here.
About ETA
The Electronic Transactions Association (ETA) is the world’s leading advocacy and trade association for the payments industry. Our members span the breadth of significant payments and fintech companies, from the largest incumbent players to the emerging disruptors in the U.S. and in more than a dozen countries around the world. ETA members make commerce possible by processing approximately $56.75 trillion annually in purchases and P2P payments worldwide and deploying payments innovation to merchants and consumers.
ETAs membership spans the breadth of the payments industry to include independent sales organizations (ISOs), payments networks, financial institutions, transaction processors, mobile payments products and services, payments technologies, and software providers (ISV) and hardware suppliers. For more information, visit electran.org.
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