Emerging Trends in U.S. Payments and Bill Presentations Systems

Published - Nov 2000| Analyst - Calvin Swift| Code - IFT026A
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Report Highlights

  • In the year 2000, total retail gross payments among consumers, business, and government were $84.7 trillion, $8.72 for every dollar of economic output. Business is by far is the largest sector, accounting for 87% of all gross payments, $73.4 trillion. Most of this is for business-to-business (B2B) commerce and is up from 83% of the total in 1990. Consumers, with $6.6 trillion, or 8% of the total, follow the business sector. Government accounts for the remaining $4.7 trillion in payments.
  • Despite the talk of an "e-economy," the American economy continues to rely heavily upon paper-based means of payment for purchasing most goods and services. Indeed, estimated paper-based gross payments in 2000 of $61.8 trillion, or 73% of the total gross retail payments. Paper-based payments include cash and checks. Checks dominate, accounting for 69% of all payments. Nonetheless, advances from electronic means of payment such as credit cards, debit cards, computer banking, electronic fund transfer (EFT) and others have eroded the paper-based share from 87% in 1990. Debit cards and non-card dependent electronic funds transfer are just emerging. EFT now accounts for nearly 25% of the total, or $20.8 trillion, up from 12% in 1990.
  • During the next 10 years, gross retail payment flows in the U.S. will increase at a 5% per year rate, slightly faster than nominal gross domestic product (GDP) and by 2010, will reach $138.6 trillion.



The goal of this report is to provide a detailed and comprehensive multi-client study of U.S. cash, check, credit card, debit card, home banking, electronic bill presentment and payment (EBPP), and other electronic payment systems with an assessment of markets and potential opportunities. The objectives include a thorough coverage of the underlying social, economic, and regulatory issues driving payment systems and technologies, as well as assessments of new and potential products and technologies. Another important objective is to provide realistic market data and forecasts for these payment means.


The main reason for doing this study is that advances in telecommunications and information technologies are leading to a revolution in the U.S. payment industry. This study seeks to answer such questions as how will consumers and es invoice and pay others in the future? Diverse payment products such as paper-based payments (cash and checks) and electronic payment products and services (credit and debit cards, electronic funds transfer, home banking, etc.) are analyzed in detail as well as underlying socioeconomic currents, technology developments, market conditions and opportunities and 10 year forecasts. The emerging electronic bill presentment and payment (EBPP) market is examined in particular detail. The role of the Internet and e-commerce are reviewed in the context of -to-, consumer-to- and other payment relationships as well as the emergence of new competitors such as "infomediaries." This comprehensive BCC, Inc. study analyzes the current U.S. market and identifies the most promising electronic and other payment opportunities for the next 10 years.


The scope of the report includes cash (coin, currency and digital cash), paper (regular checks, money orders, and travel checks) and electronic checks, electronic funds transfer (EFT), credit cards, debit cards, smart cards, electronic bill payment and presentment (EBPP). Also included are other PC-based payments, telephone payments, and other emerging electronic payment products and services used by consumers, and government in making and receiving payments to and from each other. The scope of this report is comprehensive, covering the present status of, and future prospects for paper-based and electronic payments in the U.S. It covers the many issues concerning the merits and future prospects of the payments , including strategies and e-commerce technologies. Transactions made via automated teller machines (ATMs) and point-of-sale (POS) terminals are included in the report and broken out separately for comparative purposes. From an accounting standpoint in the scheme of the payment flows (and transactions), however, these transactions are included in credit cards, debit cards, and automated clearinghouse transactions.

This report also covers in detail the sociopolitical, economic, regulatory, and technological issues regarded as critical to the industry's current state of change. The report provides a review of the payments industry, its structure, and the many companies involved in supplying these services. The competitive position of the main players in the market and the strategic options they face are also discussed, as well as such competitive factors as marketing, distribution, and operations. Although the scope is limited to retail payments, technology and product developments in wholesale payments are also made.

The value of revenues for these payment means reflects the gross value of the transaction, including administrative and transaction processing fees and expenses as well as the good or service purchased. It represents the value of the product sold to the final user, that is, consumers, es, and government entities. These transactions are valued in billions of U.S. dollars. In addition, the number of transactions is also presented in this report. These are generally measured in millions of transactions.

During the discussion of the individual market segments, transaction volume and values are related to indicators in the tables that are used for comparative purposes. Primary indicators used include: resident population, total and gross domestic product, consumer spending, and government spending. All growth rates mentioned in the tables are based on the average annual rate of growth from 2000 through the 2005, and from 2005 through 2010. An average growth rate for this 10-year period is often cited in the text. The compounding method of calculating growth rates is used. Because current dollar measures are used, these growth rates thus reflect the growth in volume or real growth and the growth including the effects of price changes and changes in product mix. Including data on transaction volume eliminates the effects of inflation.


This study provides the most complete accounting of ongoing paper-based and electronic payments developments in the U.S. currently available in a multi-client format. It provides the most thorough and up-to-date assessment that can be found anywhere on the subject. The study also provides extensive quantification of the many important facets of the market developments in the U.S. for emerging electronics technologies. This, in turn, contributes to the determination of what kind of strategic response suppliers may adopt in order to compete in this dynamic market.


Initially, a comprehensive and exhaustive search of the literature on paper-based and electronic payments was conducted. These secondary sources included money and banking journals and related books, trade literature, marketing literature, other product/promotional literature, annual reports, security analyst reports, and other publications. In addition, there were formal and informal interviews with economists, bankers, monetary authorities, other government officials, suppliers of automated teller machines (ATMs) and point-of-sale (POS) terminals, third-party transaction processors, other technology suppliers, technical experts, trade association officials, and personnel of the payment companies themselves.

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