Payments Study Explores Details of Check Usage

As Federal Reserve payments studies have chronicled over the past decade, Americans are increasingly turning to electronic alternatives for transactions and paying bills.  In a statement issued in April concerning the most recent study, a Fed committee gave a number of details about check usage.

During the 2009 calendar year, remittance checks made up more than half of all checks written.  Other findings include:

• Approximately 60 percent of remittance checks were written by consumers to businesses.  The remaining 40 percent were business-to-business checks.
• Consumer-to-consumer checks had the highest average value of all consumer check types at $472, compared with consumer-to-business remittance checks with an average of $400.
• Nearly 80 percent of checks were written for less than $500.
• Of the approximately 18 billion checks cleared between banks, over 92 percent were cleared using electronic images in place of paper.

The study also estimated that 4.5 billion account statements were issued annually on checkable deposit accounts.  Details regarding various statement types include the following:

• Nearly 50 percent of paper statements, the most common form, contained only itemized listings of transactions, without the enclosure of printed images of checks or the checks themselves.
• Fully electronic statements and image statements each represented nearly 25 percent of all statements.
• Statements with checks enclosed, common in the past, are now incredibly rare, and accounted for less than 1 percent in the study.

The number of automated clearinghouse (ACH) payments increased 9.4 percent annually from 2006 to 2009, or by 4.5 billion payments.  However, ACH growth decelerated between 2006 and 2009 with the number of ACH entries growing more rapidly earlier in the three-year period than at the end.  While the total value of ACH payments in 2009 exceeded those in 2006 by $6.2 trillion, the average value of an ACH payment declined from $2,122 to $1,946 during the period.

The statement also noted that while growth in all payment types appears to have been slowed by the economic recession—credit cards averaged an annual decline in transaction value of approximately 3 percent from 2006 to 2009—the trend is not expected to continue as the economy recovers.