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Revised Fed Study Suggests Check Use Peaked in Mid-1990s

Checks remain the largest noncash form of payment in the United States, but electronic payments continue to gain in popularity, as revised figures from the Federal Reserve’s 2001 study of the nation’s retail payments system confirm.

Last year the Fed completed the first comprehensive study of the nation’s retail payment system in more than 20 years. That study’s results, which were issued in November 2001, estimated that approximately 49 billion checks, valued at $47.7 trillion, were paid in 2000.

Further analysis and data verification since the report’s release, however, led to several data corrections. These corrections resulted in a revised estimate of 42.5 billion checks, valued at $39.3 trillion, being written in 2000. Data on electronic payments and on the composition of the check market from the 2001 report were unchanged.

The revised figures, released in a Federal Reserve Bulletin article in August, reinforce the 2001 report’s original finding that check writing in the United States is steadily giving way to electronic forms of payment.

When compared with earlier Fed studies, this new information also suggests that check usage may have peaked in the mid-1990s, though the exact year is unknown. The earlier studies estimated check usage in 1979 as 32.8 billion checks per year, and data from a 1995 study indicate that check usage was 49.5 billion checks per year.

Check use as a percentage of retail noncash payments, which includes payments by credit card, debit card, automated clearinghouse and other electronic means, declined as well — from 85.7 percent in 1979 to 77.1 percent in 1995 to 59.5 percent in 2000, according to the Bulletin article.

The article and the revised retail payments research report can be found under the “Revised Retail Payments Research Project” link at