Lockdowns, online shopping, and fear of germs during the pandemic have hastened the shift toward all types of digital payments. As a result, Gen Z has fully embraced electronic wallet services, contactless payments, peer-to-peer (P2P) payment apps, and digital uses of credit, including buy now, pay later (BNPL).
Gen Z’s use of cards and cash is declining rapidly.
The rise in contactless payments comes as more merchants accept them and more people embrace them. Nearly 70% of Gen Z respondents planned to continue using them after the pandemic (Fiserv).
Gen Z shows strong usage of digital payments, including Apple Pay, Google Pay, PayPal, and other P2P and electronic wallet services.
Gen Z is particularly fond of mobile payments. While Gen Zers use a variety of digital payment methods, they strongly favor using their mobile phones and watches. According to a study by Logica Research, more than 6 in 10 Gen Zers said mobile devices were their most popular method for digital purchases. The study also found Gen Z’s use of mobile payment apps for in-person payments is expected to rise from 5% today to 19% in the future.
Gen Z is skeptical of traditional financial institutions; they prefer digital and mobile financial tools. As digital natives who have never known life without the internet, Gen Zers conduct the majority of their banking and financial business online, something many did even before the pandemic’s accelerating force. This trend will continue, as Gen Zers expect to be able to conduct most of their financial business—including banking, investing, and payments—via mobile phone.