Fed study fills in the numbers for ATM transaction volumes and values

July 29, 2014 | by Suzanne Cluckey

The Financial Services Policy Committee of the Federal Reserve last week released its "2013 Federal Reserve Payments Study Detailed Report." The 192-page report expands on information in the 43-page 2013 Federal Reserve Payments Study, which was released in December.

While the documents focus on noncash payments (another Fed report covers cash*) the study nevertheless offers some interesting data on transactions at ATMs. For instance, while the Fed study recorded a slight drop in the number of ATM cash withdrawals using debit cards and general purpose prepaid cards ... it found that, in fact, the value of these transactions has continued to exceed inflation over the years.

So, while consumers might be adopting different use patterns, this doesn't necessarily mean that their reliance on the ATM is in any way diminished.

Cash withdrawal by the numbers

In 2012, consumers made 5.8 billion ATM withdrawals totaling $687 billion in value. The number of ATM withdrawals decreased 0.9 percent per year from 2009 to 2012. However, during the same period, the total dollar value of ATM withdrawals increased 2.0 percent, and the average withdrawal value increased from $108 to $118.

The Fed also captured data for on- and off-us ATM cash withdrawals. In 2012, 68 percent of ATM cash withdrawals were on-us, an increase from 64 percent in 2009. In terms of dollar value, 71 percent of 2012 ATM cash withdrawals were on-us.

The study measured ATM cash withdrawals by the type of account, as well. In 2012, Americans made just 3 percent of ATM withdrawals from prepaid card accounts. The remaining 97 percent came from all other types of accounts, including checking, savings and credit cards.

While the number of ATM withdrawals (5.8 billion) far exceeded the number of over-the-counter withdrawals (2.1 billion), the average value of over-the-counter withdrawals, at $715, far exceeded the average value of withdrawals at ATMs ($118) — no surprise, since ATMs almost always impose a withdrawal limit.

Cash deposit by the numbers

The Fed study found that in 2012, Americans made more cash deposits at ATMs than at labor-intensive channels such as branches and cash vaults.

However deposit values at ATMs were lower, with ATMs receiving 41 percent of all cash deposited, with an average value of $374, compared with 59 percent of over-the-counter cash deposits, with an average value of $1,000.

Overall, Americans made an estimated 2.8 billion cash deposits totaling approximately $2.7 trillion. The average value for cash deposits was $953.

Fraud comparison 

In 2012, fraudsters made 1.3 million unauthorized ATM cash withdrawals against the accounts of U.S. depository institutions for a total of $256.3 million. The average unauthorized withdrawal ($199) was significantly larger than the average authorized ATM cash withdrawal ($118).

By number, the fraud rate for ATM cash withdrawals in 2012 was 2.21 basis points (i.e., 2.21 of every 10,000 transactions were unauthorized).

By comparison, unauthorized third-party fraud  accounted for 900,000 checks paid in 2012, with a total value of $1.1 billion, and an average value of $1,272 per payment. Checks had the lowest fraud basis of the payment methods with a rate of 0.47.

Debit and prepaid cards accounted for a considerably larger volume of fraud, with an estimated 14.9 million unauthorized transactions totaling $1.5 billion in losses. The average value of unauthorized transactions was $104, compared with $39 for the average authorized transaction. The fraud rate for was 2.72 basis points.

Criminals carried out more than 13.7 million unauthorized credit card transactions in 2012, with a total value of $2.3 billion in fraudulent charges. Fraud was fairly evenly divided between card-present (52 percent) and card not present (48 percent) transactions. Of all payment methods, credit cards had the highest fraud rate at 5.76 basis points.

Additional findings of the study:

•of 776 million active general purpose cards in 2012, 334 million were credit cards, 283 million were debit cards, and 159 million were prepaid cards;

•among active general purpose cards, debit accounted for an average of 23 payments per month, compared with 11 for credit cards and 10 for prepaids;

•the number of online bill payments initiated through banking websites and directly through billers and settled over ACH, exceeded 3 billion in 2012; and

•consumers made more than 250 million payments using a mobile wallet application, and at least 205 million person-to-person or money transfer payments.

"The 2013 Federal Reserve Payments Study collected a broad cross-section of information related to complex consumer and business payments use,” said Jim McKee, senior vice president of the Federal Reserve Bank of Atlanta, which sponsored the study. "The overview contained in today’s report offers a more complete picture of how the information can be used to better understand developments in the payments system. The industry can use this data to continue serving the public interest to improve the U.S. payments system."

The study is the fifth in a series of triennial surveys, and was based on data for 2012. Data collected is combined with estimates from previous studies and then analyzed and adjusted for seasonality to produce comprehensive information about payments trends.


Topics: Debit / Credit, Deposits / Check 21, Prepaid / Stored Value / Gift Card, Security, Trends / Statistics



Suzanne Cluckey
Suzanne’s editorial career has spanned three decades and encompassed all B2B and B2C communications formats. Her award-winning work has appeared in trade and consumer media in the United States and internationally. She is now the editor of ATMmarketplace.com and BlockChainTechNews.com wwwView Suzanne Cluckey's profile on LinkedIn

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