Details of In-Depth Studies on Personal Checks and Their Use in the U.S.
Despite a significant increase in the amount of electronic payments including credit cards, debit cards and Automated Clearing House (ACH) payments - personal checks remain a popular way to pay.
The Federal Reserve System keeps track of trends in the use of various payment choices with studies conducted on a regular basis. A study in 2004 marked the first time that all electronic payments surpassed the number of payments made using personal or business checks.
The most recent study released (2006) indicates that around one-third of all payments were made using checks. While that number represents a double-digit drop from the 2003 study when checks made up 46% of all payments - it also shows that checks still surpass any single form of electronic payment. The next closest payment option is debit cards at 27%.
Research by the Federal Reserve indicates 33 billion checks were written in the year 2006.
While the data appears to show that check usage is declining somewhat rapidly, it does not necessarily mean that Americans are giving up on personal checks completely.
According to a paper released by the Federal Reserve concerning its study, "This result leads us to believe that while families adopted new forms of payment, they did not immediately stop using the older forms of payment. Payment choice likely depends on the nature of the transaction."
A survey conducted by one of the major check manufacturers in 2007 seems to confirm these findings. Harland Clarke found that fewer consumers are using checks for retail payments.
In 2004 a study showed 42% of consumers used personal checks and 31% used debit cards. Three years later those numbers reversed. 31% of consumers used checks to make retail purchases while 41% used debit cards.
However, this same study revealed that writing checks is still something the average American does on a regular basis. 67% of those questioned said they write 10 or more personal checks every month.
Some of the more typical uses of personal checks include utility bills, rent and to make payments to individuals as well as small businesses.
Demographics also play a major role in a household's preferred form of payment. According to the FRB's report, "Research has shown that age, income, and demographic characteristics are correlated with use of payment instruments."
Every family is different. They use debit and credit cards differently and they use personal checks differently. But the percent of households that continue to use personal checks has barely budged.
"Despite these increases in use and holdings of electronic forms of payment.the share of families that reported using checks as a main way of interacting with a financial institution remained stable at approximately 75 percent of families.
Convenience of use also plays a role in what payment option a person chooses. For example, credit cards and debit cards are more convenient for making online purchases, while checks are more convenient for casual payments.
In addition, there are different benefits to using one form of payment versus another. Researchers with the Federal Reserve point out that "Some card products offer consumers airline miles or cash back bonuses when they are used. Other people may prefer checks as checks could be perceived to help consumers with budgeting or accounting."
The region of the United States where checks are used most often per capita is the Midwest while people on the West Cost write checks the least.
The typical personal check users are women in their mid-40s with a household income of more than $62,000 a year.
The Fed's Survey of consumer Finances found it is younger people under the age of 35 who are more likely to regularly use debit cards
Those questioned by the major check manufacturer indicated the majority of customers purchased checks directly from their financial institution. About 20% purchased checks through direct mail.
However the most inexpensive and efficient way to order personal checks is from an online check printer such as Check Advantage.
A 2007 study released by Forrester Research found that 33% of those with checking accounts would like to reorder checks online. However, the majority of check sales come from the bank (70% to 80%). Only 8 to 15% of checks are ordered online.
There are major benefits to ordering checks online - especially from Check Advantage. Not only do you have a much wider selection of check designs to choose from like Nature Checks and Americana Checks, you can also save 75% off what your bank usually charges you to reorder.
Order your personal checks from Check Advantage today because while you may find other forms of payment convenient in certain situations, using checks has many advantages.
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