As of October 2023, 70 percent of US consumers made a mobile payment at least once in the 12 months prior. Consumers young and old are increasingly comfortable using their phones to make payments.
That's not to say differences by age don't persist. New research
by Julian Perry, Joanna Stavins, and me finds that the choice to adopt a mobile payment app is strongly influenced by age. The youngest consumers were almost twice as likely to have adopted a mobile payment app compared with the oldest consumers: 93 percent of Generation Z members under age 25, compared to 50 percent of boomers and older generations age 65 and older (figure below). Consumers were defined as adopting a payment app if they had used any of the following in the past 12 months: PayPal, Zelle, Venmo, Cash App, Apple Pay, Google Pay, Samsung Pay, or another mobile app.
Source: "Consumer Payment Behavior by Income and Demographics"; authors' calculations based on the 2023 Survey and Diary of Consumer Payment Choice.
I know you're not surprised. After all, these young consumers—among them Olivia Rodrigo, Billie Eilish, and Lil Nas X—have never known a world without the smartphone. Sometimes called digital natives, they lead the way in mobile pay.
Mobile payment app adoption also increases with education and income. Still, even with education, income, and other demographic factors held constant, the youngest consumers are more likely to adopt mobile payment apps. Compared with consumers who were age 65 and older, consumers younger than age 25 were 33 percentage points more likely to have adopted an app. In the table below, you can see that the likelihood of adopting a mobile payment app decreases with age.
Source: "Consumer Payment Behavior by Income and Demographics"
Note: The numbers above represent differences among age cohorts after controlling for income and other demographic factors.
Sometimes survey results confirm conventional wisdom, and sometimes not. In this case, what we see anecdotally out in the world aligns with the story told by the data. Maybe George Bernard Shaw was wrong after all: youth is not wasted on the young.
"Consumer Payment Behavior by Income and Demographics" also describes the adoption and use of traditional payment instruments (paper, card, and electronic payments from a bank account), the use of buy now, pay later, and the adoption of cryptocurrency. I hope you find the tables, charts, and analysis useful.
In addition, the interactive charts from the 2023 Survey and Diary of Consumer Payment Choice facilitate exploring the use of payments methods and adoption of cards and online payment accounts by income.
By Claire Greene, Center Director in the Retail Payments Risk Forum at the Atlanta Fed