NEW YORK – Americans still love cash more than debit and credit cards or checks.
Despite the growing world of credit cards, PayPal, Venmo and the on-demand economy, cash is still king, according to a new report by Federal Reserve Bank of San Francisco’s Cash Product Office.
Cash was used in 32% of all transactions last year, the highest of any payment method. Spenders used debit cards for 27% of purchases and credit cards 21% of the time.
There were about 150 billion transactions last year, according to a separate study by Federal Reserve.
“We still see significant cash preference despite rumors that everyone is switching over to cards,” says Claire Wang, a policy analyst at the San Francisco Fed.
And all those Milllennials, who seemingly never have cash in their wallets, actually use it more than everyone else.
Americans aged 18 to 24 used cash in 38% of their payments last year, more than any other age group.
Low-income households — people who earn less than $25,000 a year — tend to prefer cash over other payment methods more than households with a high income.
When it comes to small payments, cash rules across all demographics. For payments of $10 or less, Americans used cash 66% of the time. While companies like Square make small credit and debt payments easier, they still haven’t overtaken the greenback.
The flip side to the story is that the other forms of payments are inching in and cash’s lead is waning. In 2012, the last time the San Francisco Fed did the report, cash was used in 40% of transactions. Now it’s 32% — still top of the payment chain but by a smaller lead.
By Patrick Gillespie