Cards dominated the number of U.S. core noncash payments in 2018, but automated clearinghouse transfers moved most of the money, the Federal Reserve reported on December 19, 2019. Debit and credit cards accounted for 75.3% of payments in the study’s core group—cards, automated clearinghouse transfers and checks—but just 7.3% of their dollar value. Automated clearinghouse, or ACH, payments represented 16.4% of the count and 66.1% of the value. [S1][S2]

The initial estimates put 2018 card payments at 131.2 billion, worth $7.08 trillion, against 28.5 billion ACH payments worth $64.16 trillion. All dollar figures are nominal, not inflation-adjusted. These are payments from U.S. domestic accounts by consumers, businesses and government agencies, rather than a tally of purchases at shops. The study did not collect the number or value of cash payments, although it separately measured cash withdrawals and deposits. [S2]

The overall average payment fell from $604 in 2015 to $557 in 2018, even though the average card payment stayed at $54. The Fed attributed the aggregate decline to the growing share of smaller-value card payments. Their increasing weight offset the much higher average values of ACH and check payments. A dashboard showing only the overall average would hide that change in payment mix. [S2]

ACH credit transfers push funds from the payer’s financial institution to the recipient’s, as with direct-deposit payroll. ACH debits pull funds from the payer’s institution, as with a prearranged insurance or mortgage payment. Reading the ACH total as another measure of checkout activity would miss that scope. [S2]

The Fed estimated that 5.6 billion payments worth $12.90 trillion were processed internally between customers of the same depository institution. Those in-house, or “on-us,” payments were included in the overall ACH estimate. The network portion was 22.9 billion payments. Comparing a network-only figure with the report’s total without accounting for internal payments would mix different coverage. [S2]

The internal component was not simply a direct count. The report says institutions tracked internal ACH activity differently, and very large offset transfers in their databases could inflate value estimates. To produce consistent figures, the researchers used average ratios linking total and network payment counts, then used network average payment values to estimate the internal dollar amounts. The report explicitly warned that its on-us ACH estimates for 2012–2018 were likely to be revised after further analysis. [S2]

Source documents

  1. Federal Reserve payments study finds growth in card and automated clearinghouse paymentshttps://www.federalreserve.gov/newsevents/pressreleases/other20191219a.htm
  2. The 2019 Federal Reserve Payments Study, December 2019https://www.federalreserve.gov/newsevents/pressreleases/files/2019-payments-study-20191219.pdf