ATM cash withdrawals continue to grow but at a snail's pace compared with electronic payments, according to a 2010 Federal Reserve Systems Payments Study.
The annual growth rate of ATM cash withdrawals from 2006 to 2009 was 0.8 percent, the Federal Reserve reported. The number of ATM cash withdrawals was 6 billion during the three-year period. Those figures compared with 5.8 billion ATM withdrawals from 2003 to 2006, according to a study that was released in December 2007.
The value of the ATM withdrawals from 2006 to 2009 was $600 billion. That's up from $578 billion from 2003 to 2006, the Federal Reserve reported.
For its 2010 report, the Federal Reserve collected data from 1,300 financial institutions, including the 50 largest-depository firms, said June Gates, a spokesperson for the Federal Reserve Bank in Cleveland.
Story continues below...
Video surveillance and dispute management solution
ATMeye.iQ video security management solution reduces the risks of fraud and vandalism, resolves conflicts with clients, and allows monitor security events 24/7 to whole ATM network remotely. Watch ATMeye.iQ video.
"Survey participants were asked to provide data on ATM cash withdrawals made by their customers from any ATM, including withdrawals at their ATMs or at foreign ATMs, meaning ATMs operated by another financial institution or ATM operator," Gates said.
The Federal Reserve's study focused on noncash payments in the United States, Gates said. The report found that more than three quarters of noncash payments were made electronically, a 9.3 percent increase from the Federal Reserve's 2007 study.
"This growth and other statistics in the study emphasize consumers' increasing adoption of electronic alternatives for payments in the United States," the Federal Reserve said. "The number of noncash payments in the United States increased 4.6 percent per year since 2006, approximately the same pace as the previous three-year period, 4.5 percent."
The study, which was sponsored by the Atlanta Federal Reserve Bank, reported that debit card transactions grew 14.8 percent from 2006 to 2009, and prepaid card transactions grew 21.5 percent during the same three-year period.
Louise L. Roseman, director of the division of Federal Reserve Bank Operations and Payment Systems, testified in June before Congress that select retailers said cash transactions continue to grow, although at a much slower rate than electronic forms of payment.
"Although there is no direct information on trends in cash use, statistics on the growth in the use of noncash payment methods suggest some substitution away from cash in recent years," Roseman said.
