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Board of Governors of the Federal Reserve System
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Federal Reserve Board of Governors
Financial Services Policy Committee
A Committee of the Conference of Presidents
Federal Reserve System
David Fettig
FSPC Spokesman
(612) 204-5274
For immediate release
March 25, 2008

Federal Reserve Study Reveals Biggest Share of Checks Are Consumer to Business

Minneapolis, Minn., March 25, 2008--The Federal Reserve’s 2007 study of the composition of the check market released today shows that nearly 50 percent of checks written are consumer-to-business checks. The Check Sample Study reports on the composition of the check market based on responses from nine large financial institutions that together account for about one quarter of total U.S. paid check volume. The study, which categorizes the use of checks by payer, payee, and purpose, is the third component of the 2007 Federal Reserve Payments Study. Results of the first two components of the study were released December 10, 2007.

The highest percentage of check payers (writers) were consumers at 58 percent, while the highest percentage of check payees (receivers) were businesses at 72 percent. The check purpose with the highest percentage was remittance payments (payments to business and government payees that do not occur at the point of sale) at 49 percent.

The summary report of the 2007 Federal Reserve Payments Study revealed that 2.6 billion consumer checks were converted and cleared as automated clearinghouse (ACH) payments rather than check payments in 2006, an eight-fold increase over 2003. The Check Sample Study found that 42 percent of checks sampled were ineligible for ACH conversion under the current National Automated Clearinghouse Association (NACHA) rules. Ineligible checks include checks such as those with missing or no signature, checks greater than $25,000, and checks from businesses and the government.

The 2007 Federal Reserve Payments Study consisted of three research efforts commissioned to estimate the annual number, dollar value, and composition of noncash retail payments in the United States. The Depository Institutions Payments Study included responses from approximately 1,400 financial institutions (commercial banks, savings institutions, and credit unions). The Electronic Payments Study, included responses from 65 of the largest payment networks and card issuers. The Check Sample Study, while not nationally representative, included responses from nine large financial institutions that together held approximately 26 percent of the deposit liabilities and accounted for approximately 25 percent of all checks paid in the United States in 2006.

“The findings of the Fed’s Check Sample Study are intended to help the Federal Reserve, the industry, and the public better understand how checks are being used and inform future payments investment decisions,” said Richard Oliver, executive vice president of the Federal Reserve Bank of Atlanta and the Federal Reserve Banks’ product manager for retail payments. “In 2007, the fact that much of the data needed for the Check Sample Study were available within one industry source, the Viewpointe archive, allowed for a consistent and systematic sampling methodology and the effort required of participant banks was greatly reduced from what it was when a similar study was conducted in 2001. We appreciate the contributions of all the institutions that provided the information needed to conduct these studies.”

A summary report of the 2007 Federal Reserve Payments Study and detail reports on the three individual studies are available at

Attachment (25 KB PDF)

Last update: March 25, 2008