Millennial consumers, along with their Gen Z counterparts, have increasingly begun to turn to digital technologies to meet their banking and payment needs, with mobile methods being particularly popular among them.
A study conducted in March found that 38% of millennial consumers said they had used mobile wallets to pay for purchases in the month prior to the survey, compared to 22% of baby boomers.
Millennials said they were also more likely to make purchases by debit card rather than credit card, being wary of credit-related debt and fees.
The survey found that 63% of millennials said they use debit cards more often than credit cards. This suggests that millennials are looking for fast, digitally connected but also cost-effective payment methods, a trend that could provide significant opportunities for the continued growth of embedded finance.
At the same time, these same young consumers are also more likely to adopt integrated financing tools such as buy-it-now, pay-later (BNPL) solutions, according to another study.
Younger consumers were early adopters of BNPL, with India and the United States leading this trend. Almost three-quarters of millennials and 73% of Gen Z consumers in India said they had paid for something using BNPL tools. Millennials in the US are closely following millennials in India, with 61% now using BNPL methods to meet their payment needs.
BNPL methods can be attractive to younger consumers, especially because they don’t come with the same fees as other payment methods such as credit cards. These tools can also be easily added to e-commerce site checkout experiences, making them convenient for younger consumers who have grown accustomed to fast, one-click checkout experiences.
To learn more about how young consumers are reshaping the world of embedded payments, download the May Embedded Finance Tracker, a collaboration between PYMNTS and Galileo Financial Technologies.