Federal Reserve publishes second 'State of Cash: Diary of Consumer Payment Choice' study

calendar iconJun 2, 2017

The Federal Reserve published 'The State of Cash: Preliminary Findings from the 2015 Diary of Consumer Payment Choice', on November 3, 2016. The report follows The 2012 Diary of Consumer Payment Choice' study.

Each study is used by the Cash Product Office as a 'primary data source on consumer behaviour' and is 'conducted using a nationally representative sample of US consumers'. The results of the latest survey suggest that 'cash remains a highly valued and useful payment instrument' in spite of the decline in total payment share.

Data from the Federal Reserve’s Diary of Consumer Payment Choice shows that cash remains the most used payment instrument in 2016 accounting for 31% of all consumer transactions.

Executive Summary
As the payments landscape evolves, cash remains a unique, resilient, and heavily used consumer payment instrument. Still, with new payment options and ways to shop, consumers are adapting how they view and use cash. The Diary of Consumer Payment Choice (Diary) serves as the Cash Product Office’s (CPO) primary data source on consumer payment behaviour. Insights from the Diary and other data sources help the CPO understand the role that cash will play in the future. This research helps the Federal Reserve (Fed) fulfil its objectives of maintaining confidence in U.S. currency and promoting a safe and efficient payment system.

When first conducted in 2012, the Diary showed that cash was the most frequently used payment instrument and that cash use was prevalent across all demographic groups. The key findings of the 2015 Diary of Consumer Payment Choice are similar and suggest that:

  • Cash continues to be the most frequently used consumer payment instrument
  • Cash is widely used in a variety of circumstances
  • Cash dominates small-value transactions
  • The average value of cash holdings has grown

The 2015 results also show that cash is facing competition from other payment instruments. In 2015, 32 percent of consumer transactions were made with cash, compared with 40 percent in 2012. Growing consumer comfort with payment cards and the growth of online commerce, among other factors, contribute to this trend. Nonetheless, a broad range of results suggests that cash remains resilient and continues to play a key and unique role for consumers.

The first section of the paper discusses high-level, aggregate trends in cash demand and in financial institutions’ currency orders and deposits with the Fed. The second section focuses on four findings about cash use from the 2015 Diary, outlined above. The final section explores three insights that the 2015 data give us on consumer payment preferences and practices.'

Download study here


Matheny, Wendy, Shaun O'Brien, and Claire Wang. "The State of Cash: Preliminary Findings from the 2015 Diary of Consumer Payment Choice." Federal Reserve Bank of San Francisco. November 03, 2016. Accessed June 01, 2017. http://www.frbsf.org/cash/publications/fed-notes/2016/november/state-of-cash-2015-diary-consumer-payment-choice.

Last Updated: Apr 1, 2019