More and more American consumers are carrying less and less cash. A "Consumer Payments Survey," commissioned by MasterCard and conducted by Ipsos, shows that 74% of respondents no longer carry large amounts of cash with them, and 62% say they have switched to other forms of payment. More than half (56%) said they usually could find stores that accepted other forms of payment besides cash.


Debit cards are the fastest-growing form of payment, according to a First Data study released this month, growing from less than eight transactions per month in 2000 to more than 11 in 2005. The average total number of debit transactions made monthly has increased 21% in the past year, from 15 to 18.

However, not all debit transactions are alike: The First Data study showed purchase habits differ between using a personal identification number (PIN) or a signature. Consumers who used both PIN debit and signature debit at the point of sale make more transactions (23 per month) than those who use only signature debit (14) or only PIN debit (10). Still, PIN debit was preferred by more respondents (45%) than was signature debit (33%).

A separate, much smaller survey from Visa USA, reported in Bank Systems & Technology, shows that younger Americans, especially, may finally be willing to use their mobile phones as a method of payment. Of the 800 respondents, 77% said it would be difficult to get through the day without their mobile phones, and that they are twice as likely to carry their mobile phones than cash – a factor that jumps to four times in the 18-to-34-year-old age group. More than half of all respondents said they prefer electronic payment methods so they do not have to carry cash, while 61% of the respondents ages 25 to 34 said they were interested in making purchases via their cellphones.

Indeed, all methods of contactless payments are expected to grow worldwide, according to ABI Research, from $303 million this year to $1 billion in 2010, thanks to the expansion of near-field communications (NFC) in mobile handsets. By 2010, ABI expects that more than 50% of cellular handsets, or 500 million units, will incorporate NFC capabilities. The firm estimated that more than 10 million contactless payment cards were issued in North America in 2005, and more than 40 million cards, mini-cards and fobs will ship globally this year.