Each year the Federal Reserve Bank publishes its Diary of Consumer Payment Choice. This report provides insights into how consumers used cash, debit cards, credit cards, and other payment instruments in the previous year. With no significant changes reported, the takeaway of the most recent report is simply that that cash is still in demand.

Continuing Trends

The number of online purchases continued to exceed pre-pandemic levels, which has had an obvious impact on cash use. Card use also increased with certain types of purchases. For example, debit cards appeared to be the most-used payment instrument for in-person payments.

Despite the increased preference for card use, cash is still in demand. Cash accounted for about 18 percent of all payments. The report also indicated the amount of cash consumers kept in their wallets and stashed away at home likely contributed to the increased value of currency in circulation. Even though cash payments continued to be fewer than pre-pandemic times consumers still reported higher levels of cash in their wallets and at home than at the start of the pandemic. The on-person cash holding increased $5 from the previous year, bringing the average to $73 while the amount of cash a consumer might have at home increased to $418.

The Importance of Access to Cash

With approximately one in five consumers reporting that they prefer to use cash for in-person payments, the need for access to cash is evident. Cash continues to be a top choice because it provides instant settlement, eliminates the need for a third party, and offers a level of privacy other payment instruments do not.

Future of Cash

For the first time ever, the report also touched on how consumers planned to use cash in the future. Ninety-three percent of consumers have no plans to stop using cash and 79 percent responded that they believed a cashless society would be problematic.

The report indicated that even for consumers who preferred to use a credit or debit card, cash was the second most used instrument, accounting for approximately 20 percent of in-person purchases made by consumers who prefer cards.

Legislation to Protect Cash

Interestingly, some consumers reported that their use of debit or credit cards was due in part to lower rates of cash acceptance.

Findings like this indicate that legislation, like the Payment Choice Act, is more important than ever. This bill would protect American consumers right to use cash as payment at any business that accepts in-person payments. Earlier this summer, the Payment Choice Act was reintroduced in the house. In 2022 the bill passed the House on a bipartisan vote but was never brought to the floor for a vote in the Senate.

Rochester Armored Car continues its outreach efforts to demonstrate the company’s support for the Payment Choice Act and the Safe Access to Cash Act.