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Can The Checkbook Make A Comeback?

A 20-something guy with spiky hair goes to buy a 59-cent package of beef jerky at a convenience store and whips out a checkbook. An attractive woman waiting in line rolls her eyes, but then she melts over his "exotic" boar-hide checkbook cover and jumps into his arms.

"Credit cards are a sucker's game," the guy says with a wink.

He's Duncan Steele, the hero in a new video from check printer Deluxe Corp. The company is on a mission to revive the personal check, complete with a website and Facebook campaign to "fight for your right to write checks."

It's an uphill battle, to be sure.

If you're like most Americans when it comes to check usage, you probably have more in common with Erin Kneivel than Duncan Steele. Kneivel, who was shopping at a Safeway in Washington, D.C., said she never pays by check at the grocery store.

"I always use either a credit or debit card," the 25-year-old said. Except for the two checks she writes each month -- one for rent and another for the cable bill -- she barely touches her check register. Oh, and about that cable bill? "I've just been too lazy to set up the online banking payment," she admitted.

Only half as many personal and business checks were written last year as in 2000, according to the Federal Reserve. Over the same period, the average amount per check roughly doubled, to more than $1,600 -- a sure sign that few personal checks are being written to buy beef jerky.

The Fed says it has shut down all but one of its 45 paper check processing offices nationwide since 2003 because of the drop in demand. Cleveland is the only office still open.

A handful of big chain stores such as Whole Foods and Starbucks no longer accept checks in some or all parts of the country. And even the smallest mom and pop vendors are set up to swipe your plastic.

Kimberly Hall, the Safeway cashier who rang up Kneivel's items, notes that in her experience, only about 1 in 10 customers pays by check. "You won't see a checkbook come out unless the person is late 30s or older," she said.

It's true that older customers use checks in greater numbers, says Stephen Kenneally, vice president at the American Bankers Association. "As those people age," he says, "they will be gradually replaced by others who really favor electronic types of transfers."

Nonetheless, check printers are hoping to connect with a younger demographic. An Ipsos survey conducted for Deluxe suggests that young people may be looking for alternative ways to pay their bills as tighter credit lines and new consumer protections passed by Congress make it harder for them to get credit cards.

"Our research shows that while Generation X expects to write fewer checks in the future, the so-called millennials actually expect to write more," says Susan Eick, Deluxe's vice president for financial services marketing.

Eick also says the new rules that bar banks from charging for debit card overdrafts without first obtaining customer approval will most likely result in more embarrassing "declined" moments when a personal check may be the only other option for payment.

But with the convenience of ever smarter plastic cards and online banking, she says she holds no illusions about the future of the checkbook, with its almost-quaint ledger.

Tara Quinn, who runs a small sail-repair business in Annapolis, Md., used to accept only cash and checks. After years of resisting, she finally broke down and paid $368 for a card-swiping device.

"I work in an industry where the customer base is very male-dominated, and it was my experience that 80 percent of men don't carry checkbooks," Quinn says. "I don't know how many times I heard, 'Sorry, Tara, I forgot my checkbook.' "

Banks certainly aren't shedding many tears over the decline of the personal check. Nandita Bakhshi, vice president and head of product management at New Jersey-based TD Bank, says that once customers have set up online banking, they're reluctant to switch to a competitor. Trips to the ATM also reinforce bank loyalty.

"The average customer goes eight to 10 times [a month] to an ATM, and that makes a very loyal, what we call a 'sticky,' customer," Bakhshi says.

Most debit card transactions these days involve amounts under $50 -- a level once dominated by the personal check, according to Bakhshi. She adds that 62 percent of TD's customer transactions are by debit card, compared with 13 percent by personal check.

Debit and credit cards aren't quite so convenient, though, when it comes to making person-to-person, or P2P, payments. Unless you have cash on hand -- or a personal check -- how do you pay the babysitter or the kid who mows the grass?

The electronic payments company PayPal thinks it may have an answer. It recently unveiled an iPhone application that uses something called "proximity technology" to let smart phone users "bump" phones and instantly send money between PayPal accounts.

"I think you're really going to see this take off in a big way in the next three to five years," says Laura Chambers, senior director of PayPal Mobile, though she stresses that they are testing several P2P technologies.

But PayPal isn't completely ignoring the old-school check. Earlier this month, the company introduced its own version of an app that lets people use a cell phone to snap a front-and-back photo of a check and deposit it in a PayPal account.

Copyright 2023 NPR. To see more, visit https://www.npr.org.

Scott Neuman is a reporter and editor, working mainly on breaking news for NPR's digital and radio platforms.