Consumers everywhere are starting to spurn cash in favor of other electronic modes of payment. Recent research – along with potential shifts in national policy – suggest that these changes will continue.
American shoppers are costing themselves valuable funds and time by selecting to use cash instead of electronic cards, according to the recently published “The Cost of Cash in the United States,” written by Bhaskar Chakravorti and Benjamin D. Mazzotta. The report notes that the approximately $8 billion is collected annually in fees from consumers who are using non-home bank ATMs to obtain their cash – giving shoppers incentive to instead funnel their funds through electronic cards that they can use at payment processing terminals.
Shoppers who rely on cash are also costing themselves a large amount of time, giving Americans another reason to instead use credit card terminals whenever possible. The average domestic consumer spends a monthly average of roughly 28 minutes traveling to the location where they obtain their cash, according to the report – time that wouldn’t be required if they instead relied on credit cards and debit cards. Customers would also be limiting their exposure to the possibility of cash theft.
Meanwhile, the report also noted that individuals who received their income by electronic funds transfers were subject to the lowest transfer fees of all consumers, illustrating the benefits offered by digital payment methods.
The Federal Reserve also recently published information that suggests that consumers would be better off swapping to electronic modes of payment – indicating a need for business owners to outfit their outlets with all the latest payment processing technologies. The Reserve recently launched a website, “In Pursuit of a Better Payment System,” that asks readers to contribute their thoughts and criticisms about current modes of the U.S. payment system – such as the difficulty involved with using and holding cash on a regular basis.Back To Blog