Millennials drive mobile payments

31 October 2014

NEW YORK: US millennials are twice as likely as their elders to regard mobile payments as being easier and more efficient, and are driving adoption of digital currencies, two new studies have shown.

Researcher GfK looked at mobile payments as part of its latest FutureBuy study, which tracks the convergence of digital and bricks-and-mortar activities in shopping across 15 product categories.

When asked if mobile payments are "easier," "faster," or "more efficient," 29% to 46% of Generations Y (ages 25 to 34) and Z (ages 18 to 24) agreed either completely or somewhat . This compared to a range of 18% to 30% for Gen X (ages 35 to 49) and Baby Boomers (ages 50 to 68).

And 38% of those in Gen Z and 34% in Gen Y said that mobile payments are more secure than other payment methods – compared to just 16% for Gen X and 12% for Boomers.

Overall, more than half (57%) of respondents expressed some degree of concern about the security of their personal information with mobile payments, while 37% felt such payments were "more of a gimmick than a major way I pay".

Tom Neri, evp/Financial Services, GfK, expected that Millennials and even younger consumers would increasingly embrace mobile payment methods which would in turn accelerate their take-up by retailers.

"But, to encourage widespread acceptance," he added," financial services companies and device makers will need to come to terms with consumers' concerns about security and their sense that mobile payments may just be a gimmick."

Separately, Accenture polled 4,000 consumers in the US and Canada to find that 40% had used their smartphones to make a payment at a merchant location, up from 16% in 2012.

Once again, Millennials were enthusiastic adopters, with 52% of this group having done so. High income consumers (55%) were the other significant group using this payment method.

The study further indicated that 13% of Millennials and 19% of high-income respondents are already using digital currencies to make a payment at least weekly, figures that will rise to 26% and 32% respectively by 2020.

They would so this even more frequently, the study said, if they had the ability to scan a product for purchase immediately (71%) and so eliminate the requirement for check out. An alternative was a separate checkout line to speed up payment (67%).

Data sourced from Business Wire, Accenture; additional content by Warc staff