Cash no longer is king. But, that is no secret as the digitization of the 21st century greatly influences how payment takes place today. More than 40% of payments, for instance, involves the use of a debit card, which projects to continue as a main payment form for the not-too-distant future, according to a survey of how are people making payments in 2017.
LendEDU conducted the survey of 875 American consumers and found for both today (42.86%) and five years from now (45.71%), debit card received the plurality of votes, which makes sense. Debit cards offer the ease of credit cards without the headaches that come with utilizing credit. The payment method that experienced the biggest drop-off in votes between today and five years from now was cash. Nearly 11% less poll participants believed they would still mainly be using cash in five years when compared to how they are paying for things now.
Credit cards also saw a slight decrease in potential users from today to five years down the road. While 23.31% of respondents said a credit card is their main form of payment today, only 21.83% said it would be their main form of payment in five years.
Both credit cards and cash received less votes from poll-to-poll, so where did those votes go? Digital wallets, mainly. Digital wallets, such as ApplePay, saw the biggest jump in the number of respondents that believed it would become the next big payment vehicle in five years. Right now, however only .91% of respondents said a digital wallet was their main payment form of payment, but 9.49% believed it grow into their main payment form in five years.
Additionally, e-check saw a poll-to-poll increase from .34% to 8%, while virtual currency also saw a bump from .80% to 1.37%.
Except for cash and digital wallets, the discrepancies between payment forms of today and payment forms in five years were not too radical. However, when asked “How do you think your children/future generations will be making payments?” there was a drastic shift in the results.
Unlike the previous two questions, debit card (22.74%) and credit cards (16.46%) were no longer leading the pack. Almost 29% believed digital wallets would be the main form of payment for future generations.
While digital wallets trended upwards, cash went in the opposite direction. With each poll, cash received less and fewer votes until only 11.31% believed cash would be the main payment method for their children. Interestingly, cash only received a slightly higher percentage of the vote than did “virtual currency,” which came in at 8.80%.
In fact, only 2.51% more people believe cash will be more prevalent than virtual currencies in the future. The belief that virtual currencies, like Bitcoin, will become more mainstream in later years falls right in line with a previous LendEDU poll that found more Americans would be willing to invest in bitcoin in the future, especially younger consumers.
Another eye-catching statistic was that 11.89% of the respondents believed “some other form of currency not yet invented” would be the main form of payment for future generations. That answer option received more votes than did cash, e-check, and virtual currency.
Cash seems to be the payment form that will suffer the most as time goes on. Cash currently experiencing a phasing out by many small businesses showed a direct correlation between the progression of time and the percentage of people that think cash will still be the main form of payment.