Survey: Plastic Will Dominate Payments Landscape

Influential consumers believe the U.S. is on the road to an all electronic transaction society, virtually eliminating cash and checks, according to a survey conducted for Visa USA.

Nearly 80 percent of Baby Boomers said that all transactions will be conducted electronically in the future, according to the “How America Spends” telephone survey of 1,001 consumers.

Echo Boomers, the Baby Boomers’ children born from 1979 to 1989, echo that sentiment, with 74 percent saying cash and checks will go the way of buggy whips and 8-tracks.

Visa estimates that Baby Boomers, born between 1946 and 1964, today account for $3.8 trillion in annual spending and Echo Boomers account for $0.4 trillion. By 2015, Echo Boomers will be catching up, accounting for $2.45 trillion in annual spending while Baby Boomers will spend $4.6 trillion, according to Visa.

Consumers have been shifting to debit cards from credit cards for the last decade. Visa launched its debit Check Card in 1995 when less than 2 percent of Americans used a debit card. Today, more than 75 percent of U.S. adults have a debit card, according to the Nilson Report, a payments industry publication. Visa reports that U.S. consumers spent more than $600 billion with its Check Card and prepaid cards in 2006.

Visa International reported in May that debit and prepaid products account for 60 percent of its consumer volume worldwide and 67 percent of all transactions conducted with a Visa-branded payment product.

The survey of Baby Boomers and Echo Boomers was conducted in February and March by The Segmentation Co., a division of Yankelovich.