Publications
Publications
- 2016
How Do People Pay Rent?
By: David Hao Zhang
Abstract
Households still pay rent primarily with paper methods, even though electronic methods are featured more prominently among high-income, high-education, and high-rent households. These patterns may be explained either by the lack of landlord acceptance of electronic methods or by the unwillingness of tenants to pay using these methods.
The dominant methods for paying rent are cash (22 percent), check (42 percent), and money order (16 percent). Electronic methods are still rarely used, at 8 percent for bank account number payment and 7 percent for online banking bill payment, and less than 2 percent for debit and credit cards.
Compared with other large bill payments of more than $200, rental payments are much more likely to be made with paper-based methods than with electronic methods, despite the recent attempts by start-ups to make it easier for landlords to accept electronic payments. They are also much less likely to be automatic.
Check and electronic methods are more frequently used for higher-value transactions and by those with higher income and education.
The dominant methods for paying rent are cash (22 percent), check (42 percent), and money order (16 percent). Electronic methods are still rarely used, at 8 percent for bank account number payment and 7 percent for online banking bill payment, and less than 2 percent for debit and credit cards.
Compared with other large bill payments of more than $200, rental payments are much more likely to be made with paper-based methods than with electronic methods, despite the recent attempts by start-ups to make it easier for landlords to accept electronic payments. They are also much less likely to be automatic.
Check and electronic methods are more frequently used for higher-value transactions and by those with higher income and education.
Keywords
Consumer Payments; Rent Payments; Money Order; Credit Card; Checks; Credit Cards; Online Technology; Consumer Behavior; Cash; Leasing
Citation
Zhang, David Hao. "How Do People Pay Rent?" Federal Reserve Bank of Boston, Research Data Report, No. 16-2, Federal Reserve Bank of Boston, Boston, MA, 2016.