⦿ 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.

⦿ Key Developments

• 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.

⦿ Strategic Context

• 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.

⦿ Strategic Implications

• 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.

⦿ Risks & Constraints

• 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.

⦿ Watchlist / Forward Signals

• 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.