2 PAYMENT METHOD PROFILES: CARD
Case Study: The United States Spending Trends
Card spending in the United States took off in the early 90s, facilitated by the development of interoperable payment networks across state lines, growth of cross-border card capabilities, and equal access to credit and debit card services. However, by 2000, the number of check payments still outsized the sum of credit, debit, and prepaid card payments combined. It wasn’t until 2006 that credit, debit, and prepaid transactions represented more than 50% of non-cash consumer transactions. CMSPI analysis of Federal Reserve data estimates that by the following year, debit and prepaid transactions represented the highest number of non-cash consumer transactions, with 31.6 billion transactions compared to 30.5 billion transactions for check transactions. Credit card payments took a significant amount of time to surpass check payments in terms of number of transactions, finally exceeding the check count in 2012, following years of consistent growth in credit and significant drops in check usage.
Non-Cash Payment Type Spending Trends (2000-2022)
100 120
0 20 40 60 80
Checks
ACH (Credit/Debit)
Credit Cards
Debit and Prepaid
Graph 2.20 218
As debit payments grew in the early 2000s, so too did concentration in the debit market, resulting in rising card fees for a number of industries. 219 Despite a high-profile hearing in 2006 which explored rising credit card fees, it wasn’t until the Durbin amendment in 2010 and the Federal Reserve’s subsequent Regulation that introduced pricing controls and competition in the debit card market.
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