First Data sponsored the 2008 Study of Consumer Payment Preferences conducted by Hitachi Consulting and administered by the Harris Poll Online. The survey collected information on the current payments environment and future outlook. Key findings included: electronic payments account for majority of in-store purchases, debit reigns as favorite payment method, payment type varies by retail location and more.
First Data was one of the sponsors for the 2008 Study of Consumer Payment Preferences conducted by Hitachi Consulting. AN online survey was ocmpleted by 3,308 U.S. consumers in June 2008, which was administered by the Harris Poll Online. The survey was designed to collect primary consumer data profiling the current payments environment and future outlook. The survey instrument included five parts: 1) In-Store Payment Preferences; 2) Internet Payment Preferences; 3) Bill Payment Preferences; 4) Cards (including credit, debit and prepaid); and 5) Emerging Payments. This Market brief provides key findings for In-Store Payment Preferences.
1. Electronic Payments Growing and Account for Majority of In-Store Payments
Electronic payments account for 63 percent of all in-store payments. Debit now has the highest share of in-store payments at 37 percent compared to 22 percent of payments made by credit card.
2. Card-Based Payments are Replacing Checks and Cash in Stores
Debit’s share of payments at the point of sale exceeds both cash as well as credit cards.
3. Debit Reigns as Consumers Favorite Payment Method for In-Store Purchases
Thirty-seven percent of consumers prefer using debit cards to make purchases in stores followed closely by cash at 32 percent.
4. Payment Type Varies by Retail Location
Payment use varies depending on where a consumer is and what he/she is purchasing. For example, debit remains most popular in its traditional venues of grocery stores, drug stores and discount stores.
5. Debit Usage Expected to Increase While Checks Decrease
Over the next two years, consumers expect to increase their use of debit and decrease their use of checks.