Reports of the death of cash during the pandemic were greatly exaggerated, according to front-line providers of cash-payment services and ATMs.
PayNearMe, for example, embarked on what could be seen as a pandemic-era pivot to support ACH, Apple Pay, PayPal, Venmo and QR code-based payments in addition to its primary service that enables consumers to make cash payments to online billers through a cash acceptance network.
But there was no need to pivot away from cash, according to Anne Hay, chief marketing officer for the Santa Clara, California-based firm.
"More transactions than ever are digitized, but that doesn't mean people aren't using cash. Until some other way emerges for those who are unbanked or who prefer to manage their budget during tight times with cash, its use is not going away," she said.
PayNearMe, founded in 2009 in the wake of the financial crisis, has seen this pattern before. Today, rising inflation is putting pressure on consumers struggling to make ends meet, she said.
"In the 2008 financial crisis cash usage increased, and as the economy worsens we expect to see the segment of consumers who are hardest-hit move further into cash," Hay said.
These consumers are already struggling with their bills, she said. One in four U.S. adults in a recent PayNearMe survey said they have paid an important bill late within the last 12 months; 16% said they expect to delay paying important household bills; and 54% worry they won't be able to pay their bills during a potential recession this year. PayNearMe conducted its online survey in February 2023 among 1,800 consumers.
U.S. consumers' cash usage ticked up slightly in 2021 over 2020 as more businesses opened and social distancing declined, recent Fed data suggests.
In the most recent survey of consumers' cash usage, 85% of consumers reported they had used cash in the last 30 days, up from 82% in 2020, according to an October 2022 report by the Federal Reserve Bank of Atlanta based on its
Another way to track cash use is the decline — and recovery — of ATMs.
Euromonitor International recently reported a 4% decline in the number of active U.S. ATMs, from a peak of 470,000 in 2019 to 451,500 at the end of last year. The London-based firm cited the broad adoption of digital payments during the pandemic as a key factor in the ATM decline.
But the ATM Industry Association, based in Sioux Falls, South Dakota, says the perception of fewer ATMs is overblown, and consumers are using cash as heavily as ever, if not more.
It's true that hundreds of ATMs were inaccessible during the pandemic due to closures of office building lobbies, hotels and transportation hubs, but those conditions were short-term, David Tente, executive director for the U.S. and Americas as the ATMIA.
"As of last year, the ATM industry has fully recovered," Tente said, noting that the total number of ATMs in service globally is expected to expand by 5% through 2030, with U.S.-based ATMs on track to grow by 4.3%.
The ATMIA doesn't track total number of ATMs, due to the complexity of counting independent and bank-owned machines, Tente said, noting that the unavailability of many ATMs during 2020 and 2021 was temporary and not by the choice of operators or consumers.
"Also, no one should be quoting ATM population numbers as pure fact because it's virtually impossible to do an exact count of the number of ATMs in service for a variety of reasons — estimates are the industry standard," he said.
