Check usage in the United States has been on the decline for many years, but reliable predictions about the future of the check can be hard to come by. Exaggerations and generalities tend to creep into arguments both for and against their continued existence. Some predict that checks will disappear entirely within a few years; others expect them to continue more or less indefinitely. Who is right?
This paper is intended to provide some realistic projections about how long checks will continue to exist in the United States, and in what numbers. While these should be considered theories rather than scientific results, we have attempted to predict realistic scenarios in which check usage may either decline precipitously or stabilize at reduced levels from today’s.The report is roughly organized into three sections:
Common Myths About Check Usage
Clearing up a few widely held misconceptions about how check usage is measured, who is still using them the most, and which other payment methods are superseding them.
Why Are Checks Declining, and What Is Replacing Them?
An examination of several disruptive technologies that have displaced more than half of check usage already; why some people keep writing checks despite the availability of other options; and the final obstacles in the way of converting the last several billion checks from paper to electronic payments. We also explore an alternate future in which cryptocurrencies such as Bitcoin experience runaway success and further impact the payments landscape.
Conclusions and Projections
We summarize the major factors that will affect how rapidly, or slowly, check usage will continue to decrease, followed by three scenarios in which it declines from the current 18 billion to between 8 billion and 3 billion payments per year by the end of the next decade. Finally, we address the effect of the biggest demographic factor commonly associated with checks’ continued use – the user’s age – and why it may or may not be as big a contributing factor as you think.