How Small Businesses Prefer to Get Paid [2026 Data]

83% of US small businesses with $1 million to $10 million in annual revenue still made or received a payment by paper check in 2024, the highest share of any business size segment, according to the Federal Reserve’s 2024 Business Payments Study. That is not a story of checks holding steady while everything else changes around them, though. ACH bank transfer use among the same small businesses jumped from 59% to 78% in a single year. This guide covers what payment methods small businesses actually use in 2026, how quickly that mix is shifting, and how small business behavior compares with very small and larger companies.

Which payment methods do small businesses use most in 2026?

Across all US businesses surveyed, checks remain the single most commonly used payment method at 73%, narrowly ahead of ACH bank transfer (71%), digital wallets (67%), credit card (63%), cash (62%), debit card (61%), and wire transfer (51%), per the Federal Reserve’s 2024 Business Payments Study, fielded in the third quarter of 2024 across 2,005 US businesses stratified by revenue size and industry. The survey asked about payments a business made to, and received from, other businesses, employees, consumers, and government agencies over the prior 12 months, so these figures describe a business’s overall payment mix rather than customer invoice payments alone, and businesses could and did report using several methods at once.

Figure 1: Share of surveyed US businesses that made or received a payment by each method in 2024. Source: Federal Reserve Financial Services, 2024 Business Payments Study (2,005 US businesses, Q3 2024).

Small businesses specifically, defined in the study as firms with $1 million to $10 million in annual revenue, lean on check even harder than the overall average: 83%, against 78% for ACH, 71% for credit card, and 64% for cash. No other size segment in the study, from businesses under $1 million in revenue up through firms over $250 million, reported a higher check usage rate.

Have small businesses actually stopped using paper checks?

Not individually, no, even though checks have shrunk dramatically as a share of B2B payment volume industry-wide. Checks accounted for 81% of B2B payments in 2004, a share that had fallen to 33% by 2022 and to just 26% in 2025, according to the Association for Financial Professionals’ 2025 Digital Payments Survey of 223 financial professionals, reported by Nacha. That is a measure of the dollar and transaction volume moving through checks, not a count of which businesses still write or accept one occasionally, and the two metrics can move in different directions at once.

Figure 2: Share of B2B payments made by check, 2004 to 2025. Source: Association for Financial Professionals, 2025 Digital Payments Survey (223 financial professionals), via Nacha.

That is exactly what the Federal Reserve’s business-level data shows happening among small businesses: the share of small businesses that used a check at all rose from 73% to 83% between 2023 and 2024, even as the volume of dollars moving through checks industry-wide kept shrinking. A large check volume decline can coexist with more individual small businesses still keeping a check option available, most often as a fallback for the client or vendor relationships that have not moved to digital payment yet. AvidXchange’s 2025 Trends Survey found a similarly small remaining core: only 8% of organizations now pay suppliers by check most often, while 28% reported paying suppliers exclusively through electronic payment methods.

How does payment method usage differ between very small and small businesses?

Very small businesses, those under $1 million in annual revenue, and small businesses, those between $1 million and $10 million, share a preference for check but diverge sharply on ACH. Very small businesses used ACH at 53% in 2024, compared with 78% for small businesses, a 25-point gap that is the largest of any payment method the Federal Reserve tracked between the two segments. Cash and credit card usage were closer, with very small businesses at 66% for both and small businesses at 64% cash and 71% credit card.

Figure 3: Payment method usage, very small businesses (under $1M revenue) versus small businesses ($1M-$10M revenue), 2024. Source: Federal Reserve Financial Services, 2024 Business Payments Study.

Large and very large firms show the opposite pattern from very small businesses. The Federal Reserve’s report notes that large and very large firms rely more heavily on digital payment types: ACH at 76-77%, digital wallets at 74-75%, and wire transfer at 62%. The pattern across all four segments points to a business’s size and its existing banking infrastructure, not just industry or preference, as one of the stronger predictors of how digital its payment mix already is.

Why do small businesses still rely on checks despite the cost?

Small businesses are not unaware of the downsides. When the Federal Reserve asked businesses what they wanted improved about how they make and receive payments, 64% of small businesses cited fees and end-to-end cost as a top challenge, versus 58% of very small businesses, and 33% of small businesses cited slow processing speed as a top challenge, versus 37% of very small businesses. Those complaints line up with the two most commonly cited drawbacks of paper checks elsewhere in payments research: check fees run several dollars per item once postage, printing, and manual reconciliation are counted, and a mailed check can sit for days before it is deposited and cleared.

Figure 4: Small businesses reported the highest check usage rate of any business size segment in 2024. Source: Federal Reserve Financial Services, 2024 Business Payments Study.

What keeps checks in the mix anyway is largely relationship-driven rather than a genuine preference: a check stays available because a specific client or vendor still expects one, not because a small business would choose it fresh today. That is consistent with the same survey’s finding that businesses using faster digital payment rails reported 10% higher satisfaction with their financial institution than businesses that had not adopted them.

How fast is small business payment behavior changing?

Quickly, at least for the two payment methods small businesses added the fastest. ACH bank transfer usage among small businesses rose 19 percentage points in a single year, from 59% in 2023 to 78% in 2024, the largest one-year swing of any payment method the Federal Reserve tracked for this segment. Credit card usage rose 11 points over the same period, from 60% to 71%. Check usage rose too, by 10 points, meaning small businesses were adding payment options rather than swapping one method for another.

Figure 5: Small business payment method usage, 2023 versus 2024. Source: Federal Reserve Financial Services, 2024 Business Payments Study.

Digital wallet usage was the one method that moved backward for small businesses, slipping from 64% to 62%, even as digital wallets grew among large and very large firms over the same period. One likely explanation is that small businesses’ early digital wallet adoption was concentrated in consumer-facing payment acceptance, and as more of those businesses added ACH and next-day ACH for supplier and vendor payments in 2024, digital wallets simply made up a smaller share of an expanding overall payment mix rather than being actively dropped.

Small Business Payment Method Usage at a Glance

Payment method	Small businesses (2024)	Very small businesses (2024)	1-year change, small businesses
Check	83%	78%	+10 pts
ACH bank transfer	78%	53%	+19 pts
Credit card	71%	66%	+11 pts
Digital wallet	62%	61%	-2 pts

Table 1: Payment method usage by business size, and year-over-year change among small businesses. Source: Federal Reserve Financial Services, 2024 Business Payments Study.

The Bottom Line

Small businesses are not choosing between checks and digital payments, they are running both at once, and the digital side of that mix is growing faster. Check usage among small businesses climbed to 83% in 2024, but ACH climbed harder, from 59% to 78% in a single year, and credit card usage rose from 60% to 71% over the same period. The practical read for a small business setting up how it gets paid in 2026 is not to rip out check acceptance overnight, since real clients and vendors still use it, but to make sure a faster method is the default path rather than the fallback. A BillyPaid invoice lets a business list bank transfer, card, and other payment options directly on every invoice it sends, so a client picks whichever method they already prefer instead of defaulting to whatever used to be the only option on file. More on the late-payment side of this picture is in BillyPaid’s Late Payment Statistics 2026.

Frequently Asked Questions

What is the most-used payment method among small businesses? The paper check, still. 83% of small businesses with $1 million to $10 million in annual revenue made or received a payment by check in 2024, the highest share of any business size segment, according to the Federal Reserve’s 2024 Business Payments Study. ACH bank transfer was close behind at 78%, up sharply from 59% the year before.

Are small businesses switching from checks to digital payments? Small businesses are adding digital payment methods faster than they are dropping checks. ACH bank transfer usage among small businesses rose from 59% to 78% between 2023 and 2024, and credit card usage rose from 60% to 71%, but check usage rose too, from 73% to 83%, per the Federal Reserve’s 2024 Business Payments Study. Digital wallet usage was the one method that slipped, from 64% to 62%.

Why do small businesses still rely on paper checks? Familiarity and existing vendor and client relationships are the likely drivers, since the survey data shows small businesses are not blind to the downsides. 64% of small businesses cited fees and end-to-end cost as a top payment challenge, and 33% cited slow processing speed, according to the Federal Reserve’s 2024 Business Payments Study of 2,005 US businesses.

How does small business payment behavior differ from very small businesses and larger companies? Very small businesses, those under $1 million in revenue, lean even more heavily on check (78%) but use ACH far less (53% versus 78% for small businesses). Large and very large firms flip the pattern, relying more on ACH (76-77%), digital wallets (74-75%), and wire transfer (62%), and less on check relative to their overall payment mix, per the Federal Reserve’s 2024 Business Payments Study.

Sources and References

1. Federal Reserve Financial Services, 2024 Business Payments Study / Federal Reserve Payments Insights Brief (2,005 US businesses, fielded Q3 2024), payment method usage, pain points, and year-over-year change by business size segment.
2. Nacha, Over 21 Years, a Massive Drop in B2B Check Payments, Study Finds (September 23, 2025), reporting the Association for Financial Professionals’ 2025 Digital Payments Survey (223 financial professionals) on check share of B2B payment volume, 2004 to 2025.
3. J.P. Morgan, 2025 AFP Digital Payments Survey: Key Highlights, corroborating check share of B2B payments, 33% (2022) to 26% (2025).
4. AvidXchange, B2B Payment Trends in 2025 and Beyond (2025 Trends Survey), share of organizations paying suppliers by check most often and share paying exclusively through electronic payments.

Note: All figures verified as of August 2026.