Consumers continue to reduce credit card use, Federal Reserve says
Americans continue to be weary of accumulating additional credit card debt, and have continued to switch to cash, checks and debit cards for purchases in recent months.
This trend was further confirmed by a new Federal Reserve Board study, which found that all types of electronic payments have become more widely used for purchases, with the exception of credit cards.
“The results of the study clearly underscore this nation’s efforts to move toward a more efficient electronic clearing system for all types of retail payments,” said Richard Oliver, executive vice president of the Federal Reserve Bank of Atlanta. “It is also likely that the results reflect changing consumer behavior during difficult economic times.”
The annual use of debit cards increased slightly from the last study in 2007. These transactions now comprise 12.8 billion electronic transactions annually. This represented a 14.8 percent annual growth rate for the payment. By comparison, credit card payments declined by 100 million during this period to 21.6 billion.
Debit cards now hold the lion’s share of all online transactions. The payment type is now used for 16 billion more payments than credit cards.