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Consumer Information

From Seashells to Bytes

Electronic Payments: The Wave of the Future, Here Today

Check Use Slowing but Still Important

Cash Is Still Popular

Consumers' Corner

Introduction

More than half of the noncash payments made in the United States today are initiated electronically using debit cards, credit cards, or automated clearinghouse, or ACH, transactions, according to Federal Reserve studies. The number of electronic transactions increased 45 percent in just three years recently, climbing to about 44.5 billion separate payments in a single year.

Debit Cards
When you use your debit card, you typically enter a secret personal identification number, or PIN, and the money is quickly, sometimes instantaneously, taken out of your checking account. It is then transferred into the account of the party you are paying.

Debit cards account for more than half of the overall growth in electronic payments; payments in the U.S. recently doubled to nearly 16 billion transactions. The average dollar amount of a transaction is $40, according to studies, mostly for routine retail purchases.