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1 1 (March 10, 2021)

handle is hein.crs/govecok0001 and id is 1 raw text is: Congressional * Research Service informing the qeisltive debate since 19 4___________________ Pandemics, Payments, and (Digital) Property March 10, 2021 Many people have heard the phrase cash is king, but is that still true? Even in today's digital world, cash is still an important tool for retail transactions among many consumers, and some still rely on it. But today, electronic payments are the primary mechanism for consumers to use money. Electronic payments are an old concept. For 60 years, Americans have been using cards that, when swiped, send a signal electronically to financial institutions to make a transfer of funds from the purchaser to the seller. Congress first passed the Electronic Fund TransferAct (P.L. 95-630) in 1978 to regulate debit card transactions. Today, debit cards are the most common tool for consumer retail payments. But new forms of electronic payment have emerged for consumers ranging from prepaid cards to digital wallets to cryptocurrencies and other forms of digital assets. One of the byproducts of the Coronavirus Disease 2019 pandemic is an economic environment that encourages electronic payments. Perhaps not coincidentally, the universe of electronic payment options has increased substantially, with a few new types of tools gaining prominence in the past year. This Insight looks at how the pandemic has impacted consumer payments and how some of these trends are altering the way consumers pay for goods and services. Additionally, it considers how a prolonged pandemic economy may contribute to a new level of comfort among consumers seeking to use innovative payment options and how this may impact the future payments landscape. Mobile Payments, Contactless Payments, and the Potential Decline of Cash Before the pandemic, 82% of consumers used cash, and almost 92% used electronic payment cards. Federal Reserve survey data shows that in 2019, nearly 35% of payments were made with debit cards and 24% were made with credit cards, while cash comprised less than 22% of transactions. Electronic payments occur in two ways: card present and card-not-present (CNP). Card present transactions are purchases where the consumer presents a card in person and pays at a register. Alternatively, with CNP transactions, the consumer provides payment account information remotely over the phone or through the internet. CNP transactions accounted for 27% percent of debit transactions and 40% of debit transaction value in 2019. Congressional Research Service https://crsreports.congress.gov IN11632 CRS INSIGHT Prepared for Membersand Committeesof Congress

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