Wednesday, December 23, 2009

Cash is King ...

"On PayPal, eBay's online payment unit, the number of cash gifts through PayPal Send Money grew 164% from June to December. Start-up, an online gift-giving service that is a partner of PayPal, says the number of cash gifts given through its site has increased eight times since November, to 1,043 in December. This month, Lottay users requested $11.2 million in cash.

In a consumer survey, money transfer giant Western Union concluded cash is the most desirable holiday gift this year. More than half the respondents, 53%, said they knew someone who preferred cash to pay for daily expenses, such as gas and groceries. "The best gifts are the ones most wanted and needed, and this year, that gift is cash," says Jorge Consuegra, senior vice president of U.S. product management at Western Union. That notion is borne out by the Consumer Reports holiday shopping poll. The most common gifts consumers plan on giving this season are gift cards (46%), money (44%) and toys (42%). The cash dash does not end there. Online payments provider eBillme says another major trend is paying for gifts with cash and debit cards.

"Consumers are going back to basics: They are using cash across the board," says eBillme CEO Marwan Forzley. Credit card spending on holiday presents is down $100 a person as consumers increasingly buy gifts with more cash and debit cards, says Ed Farrell, director of market research for Consumer Reports.

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