Business credit card acceptance and other electronic payment methods comprised over three-quarters of all non-cash payments by number and more than half by aggregate amount in 2009, according to Federal Reserve data (at UniBul our own data show a similar distribution). Electronic payments are defined as ones that are cleared over a card network (e.g. Visa or MasterCard) or through the ACH system. They do not include large-value funds transfer systems, which are not analyzed in this study. The number of e-payments grew 9.3% per year on average from 2006 to 2009. The ratio of electronic payments to overall non-cash transactions rose from 67.9% to 77.6% during the same period. The total amount of e-payments rose by 6.0% per year, growing from 45.1% of non-cash payments in 2006 to 56.3% in 2009.
Over half (60.0%) of all non-cash payments in 2009 were made with debit, credit, or prepaid cards, making up 4.8% of the aggregate amount. By contrast, ACH payments represented 17.5% of non-cash payments and 51.4% of the value.
Business credit card acceptance was the only payment form to show a decline for the period from 2006 to 2009 (-0.2% per year, on average). There were a total of 21.6 billion credit card payments in 2009, 151 million below the level measured in 2006. The total amount was $1.9 trillion in 2009, down from $2.1 trillion in 2006. This fall in credit card use could be reflecting the economic slowdown and may not necessarily indicate permanent changes in the behavior of businesses and consumers. For reference, the rate of seasonally adjusted consumer revolving debt, mostly comprised of outstanding credit card balances, in the U.S. rose in every month from January 2006 to its highest level in August 2008 before falling in every subsequent month through December 2010.
By contrast to business credit card acceptance, debit card transactions continued to grow in double digits from 2006 to 2009 and represented 34.8% of non-cash payments in 2009 (2.0% by value). Total debit card transactions rose 14.8% per year for the period. PIN debit payments rose more quickly (15.6% per year) than signature-based debit transactions (14.3% per year). The rise in the absolute number of signature-based debit payments from 2006 to 2009 (7.7 billion) was greater than the total rise in PIN debit payments (5.1 billion).
On average, the value of the signature-based debit transaction fell from 2006 to 2009 from $40 per item to $37. By contrast, the average amount of PIN-based debit payments rose during this period, from $37 to $39 per item.