As the youngest generation, Generation Z grew up in an era of technological advancement and digitization. So it’s no surprise that they differ from their predecessors when it comes to payment methods. Gen Z are quick to adopt new payment methods such as digital wallets and mobile payments, and they are also more likely to use peer-to-peer payment apps than traditional banking channels.
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Data for today’s episode courtesy of a report from Javelin Strategy & Research: Gen Z is Coming of Age, Merchant Service Providers Need a Plan
Top Payment Methods Used by Gen Z Consumers
- 35% off with a major debit or check card accepted anywhere
- 17% use a major credit card accepted anywhere
- 17% use cash
About the report
Generation Z, defined as those born in or after 1997, must be a top priority for all merchants and their service providers. This generation includes consumers over the age of 25, which means that this generation already consumes like adult consumers, and the consumption of this age group will soar in the next few years. Merchants need to build relationships with Gen Z now to increase sales and build relationships with young consumers that can last for decades.
But merchants, especially small and medium businesses (SMBs), don’t have the time or ability to really consider and incorporate Gen Z’s payment preferences. Many merchants hand over their payment operations to service providers that handle acceptance, capture, gateway services, and more. This means these providers, such as payment facilitators (PayFac), acquirers, and point-of-sale (POS) technology providers, need to help their merchants best serve Gen Z service success.