Consumer habits hold steady as payment options grow

⦿ Executive Snapshot

What: A national survey reveals that consumer payment behaviors in the U.S. have remained stable over the past three years, with cash still playing a significant role.
Who: Federal Reserve Financial Services, Kathleen Young (executive vice president and chief of FedCash® Services), U.S. consumers.
Why it matters: Understanding consumer payment choices is crucial for financial institutions as they adapt to evolving payment technologies and consumer preferences.

Cash remains the third-most-used payment method, accounting for about 1 in 7 payments.
76% of consumers carried cash in 2025, with an average amount of $69, while 45% stored an average of $364 for savings or emergencies.
Households earning less than $25,000 per year and adults 55 and older rely more on cash than other demographics.

The survey has been conducted annually since 2016 to track changes in consumer payment habits amidst technological advancements in payment options.
Despite the rise of digital payment methods, cash usage has shown resilience, highlighting the importance of maintaining a diverse range of payment options for consumers.

The stability of cash and card use indicates that financial institutions may need to continue supporting cash-based transactions alongside digital options.
The demographic trends suggest targeted strategies for different consumer segments, particularly for low-income households and older adults who rely more on cash.

The ongoing evolution of payment technologies could disrupt traditional cash usage, posing risks to cash-reliant businesses.
Regulatory changes surrounding digital payments may impact consumer choices and payment behaviors in the future.

Future surveys will continue to track shifts in consumer payment preferences and the impact of emerging payment technologies.
Monitoring changes in regulatory frameworks around cash and digital payments will provide insights into future consumer habits.