Federal Reserve consumer payment survey shows continuation of pandemic trends, including rising credit card usage and enduring demand to hold cash

The Federal Reserve System’s FedCash® Services (FCS) released a report from its ongoing research into the payment habits of the U.S. population. The 2023 findings from Diary of Consumer Payment Choice finds that consumer payment behavior remains consistent with the early pandemic, including a shift toward credit card payments and a slight decrease in the share of cash-based transactions. The average amount of cash held in adults’ pocket, purse, or wallet rose to $73, reflecting a recent trend of higher consumer interest in holding cash.

“We found that some of the major payment trends that started early in the Covid-19 public health emergency have continued into the pandemic’s later stages,” said Kathleen Young, executive vice president of the Federal Reserve Bank of San Francisco and chief of FedCash Services. “Consumers have continued to use credit cards – the most used payment method in 2022 – more often. Nonetheless, cash accounted for approximately 20 percent of all consumer payments since 2020, and this enduring demand indicates that there are consumers who need or choose to use cash, underscoring the need for a strong and resilient payments system.”

Key findings from this nationally representative survey highlight how consumer cash preferences changed throughout the COVID-19 pandemic:

• The share of payments using cash declined slightly from 2020 and 2021, to 18 percent of all payments.
• The share of in-person purchases and person-to-person (P2P) payments remained steady since 2020, at 81 percent.
• The value of cash in a person’s wallet, purse or pocket increased by $5 compared to 2021, to an average of $73.
• Average store-of-value holdings remained elevated compared to pre-pandemic holdings and increased slightly to $418.