A guide to payment methods in the United States

Everything you need to know about American e-commerce and payment preferences

Countries United States

United States: an e-commerce & payments primer

The first modern credit card was the Diners Club charge card, founded in 1950 by a group of New York businessmen who, at least according to legend, one evening found themselves unexpectedly short of cash when it came time to pay their restaurant bill.

Given the American pedigree of the payment card, it’s unsurprising that credit cards are the United States‘ payment method of choice, with a 51% market share [1]. Despite this, however, alternative payment methods are also popular in the US.

Wallets, the most popular US payment alternative, take 30% of the online payment market, bank-transfers 8%, cash 2% and various other payment methods a combined 9% [1]. Visa dominates the card market with a 60% share, Mastercard has 25%, American Express 9%, and other smaller card schemes 5% [1].

America’s e-commerce market

According to the last annualised figures available, the total e-commerce market in the United States is worth US$1,517.2 billion [1]. US e-commerce is growing at a rate of almost 19% a year. An average US e-commerce shopper spends US$4,585 a year online. Online sales are 16% of total retail sales. The most popular e-commerce purchase categories are fashion (31%), electronics & media (21%) and toys, hobby & DIY (20%) [1].

In 2021, Amazon’s share of the US e-commerce market was at an all-time high of 57% [2]. Amazon Marketplace, the company’s platform for third-party sellers, captured 25% of the US online market on its own [3]. That still leaves an e-commerce market worth US$650 billion divided up between a broad ecosystem of different merchants; some generalist, others specialising in particular categories. That’s bigger than the e-commerce market in LatAm, Eastern Europe, Middle East and Africa together  [1].

US market insights for e-commerce merchants

Even in turbulent times, the US economy continues to perform. The IMF forecasts that American GDP will grow by 3.7% in 2022, falling to 2.4% in 2023 [4]. Despite concerns about high inflation, consumer spending was still growing at a rate of over 0.2% when this report was last updated [5].

By mid-2022, and in the face of a challenging situation on many fronts internationally, US consumer confidence fell to 98.7 points — just below its 100-point baseline but still the lowest level in a decade [6]. According to Moody’s, investment volumes were still rising in the first quarter of 2022 [7].

After a sharp peak during the worst of the pandemic, US unemployment fell to just 3.6% in May 2022 [8]. Economists usually define “full employment” as occurring when unemployment rates are somewhere between 3% and 4% [9].

In the United States, e-commerce, fresh from a shot in the arm during the pandemic, also remains robust. In some categories, for instance auto parts or groceries, the annual growth in online orders is between 20% and 30% [10]. And this double-figure growth in online commerce is expected to persist until at least 2026 [10].

Enabling and limiting factors in US e-commerce

91% of Americans have a fixed-line Internet connection at home and 87% have an Internet-enabled smartphone [1]. According to the Pew Institute, the gap between urban and rural broadband provision is finally being bridged. In 2015, only 56% of rural households had a broadband connection [11]. Today, that figure is 72% [11]. As part of his stimulus plan, President Biden aims to spend $100 billion to give the US affordable, universal and high-speed broadband [12].

97% of Americans have a bank account and 69% have a credit card [1]. According to White House figures, along with the 3% of unbanked, a further 19% of ‘underbanked’ Americans have a bank account but supplement it with non-traditional financial services like check cashing or payday loans [13].

The United States ranks 14th out of 160 in the World Bank’s Global Logistical Performance Index. In response to the rapid growth of e-commerce, the carrier industry in the USA has been expanding rapidly. At times, the US Postal Service struggled to cope during the pandemic, with volumes rising by 30% [14]. The post office also announced a rise in the price of sending packages of up to 6.5%, with the exact increase depending on what’s being sent and how [15].


  1. Original PPRO research
  2. https://www.pymnts.com/news/retail/2022/amazons-share-of-us-ecommerce-sales-hits-all-time-high-of-56-7-in-2021
  3. https://www.marketplacepulse.com/articles/amazon-marketplace-is-25-of-us-e-commerce
  4. https://www.imf.org/en/Publications/WEO/Issues/2022/04/19/world-economic-outlook-april-2022
  5. https://www.bea.gov/news/2022/personal-income-and-outlays-march-2022
  6. https://www.bloomberg.com/news/articles/2022-06-28/us-consumer-confidence-drops-to-lowest-since-february-2021
  7. https://www.economy.com/united-states/indicators
  8. https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm
  9. https://www.economicshelp.org/blog/453/unemployment/definition-of-full-employment
  10. https://www.emarketer.com/content/us-ecommerce-by-category-2022
  11. https://www.pewresearch.org/internet/fact-sheet/internet-broadband/?menuItem=89fe9877-d6d0-42c5-bca0-8e6034e300aa
  12. https://www.wsj.com/articles/biden-aims-for-universal-high-speed-internet-in-infrastructure-plan-11617271202
  13. https://247wallst.com/banking-finance/2018/10/23/unbanked-population-trends-keep-improving-in-america
  14. https://nymag.com/intelligencer/2020/12/the-usps-is-struggling-with-covid-and-christmas-surges.html
  15. https://www.ecommercebytes.com/C/abblog/blog.pl?/pl/2020/11/1605561099.html

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Quick facts

The American e-commerce market made up 14% of retail sales in 2021 and is expected to continue to grow year on year. In fact, it is estimated that by 2040 online sales will make up 95% of all.

The top three reasons Americans give for shopping online are cheaper prices, a wider range of products and the convenience of delivery.

The IMF predicts the US economy will grow by 6.4% in 2021 and 3.5% in 2022, however, they are also predicting the US will have inflation of 2.3% in 2021 which will continue to rise until 2025.

General Information

  • Population 331.4 m
  • Population 15 + 271.1 m
  • Online population 302.3 m
  • Area 9,833,520 km2
  • Currency USD
  • GDP 22,939.6 bn $US
  • GDP per capita 69,216 $US

Payment types

  • Card-based payments
  • Cash-based payments
  • Bank transfer
  • Wallets
  • Other
[{"label":"Card-based payments","value":"51"},{"label":"Cash-based payments","value":"2"},{"label":"Bank transfer","value":"8"},{"label":"Wallets","value":"30"},{"label":"Other","value":"9"}]

Banked population
  • United States 97%
  • North America 97%
  • World 67%
Credit card penetration
  • United States 69%
  • North America 70%
  • World 19%
Internet penetration
  • United States 91%
  • North America 92%
  • World 62%
Smartphone penetration
  • United States 87%
  • North America 88%
  • World 70%

The E-Commerce Market

Top e-commerce segments

  1. Fashion: 31%
  2. Electronics & Media: 21%
  3. Toys, Hobby & DIY: 20%
  4. Furniture & Appliances: 16%
  5. Food & Personal Care: 12%

Cross-border e-commerce

  1. Cross-border proportion of total e-commerce – 7%
  2. Value of cross-border e-commerce – 103.9 bn $US
  3. Online shoppers who have shopped cross-border – 33%

Top 3 cross-border shopping origin markets

  1. China: 49%
  2. UK: 12%
  3. Japan: 7%
B2C e-commerce growth 20->21
  • United States 18.8%
E-commerce % of total retail
  • United States 16%
  • North America 16%
  • World 20%
E-commerce completed on a mobile device
  • United States 46%
  • North America 45%
  • World 53%

E-Commerce Trends

  • E-commerce market size 1,517.2 bn $US
  • E-commerce spending per capita 4,585 $US
  • E-commerce spending as % of GDP 6.6%

The Credit Card Split

  • Visa
  • Mastercard
  • American Express
  • Local Schemes
[{"label":"Visa","value":"60"},{"label":"Mastercard","value":"25"},{"label":"American Express","value":"9"},{"label":"Local Schemes","value":"5"}]

The information on our Insights pages has been compiled by us in cooperation with Datamatics and Wright & Brown. The data shown is partially owned by us and partially owned by GlobalData. © 2021 by PPRO Financial Ltd. No data and information can be used for any further publication without the explicit approval of PPRO.


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