Generation Z, born between 1997 and 2012, represents a cohort deeply intertwined with digital technologies.
“They are described as the first digitally native generation — a generation that has lived with mobile phones and apps for most of their lives. The iPhone was introduced 17 years ago when the oldest of this cohort, known as Gen Z, were in the fourth grade,” PYMNTS CEO Karen Webster wrote in a recent article.
Unsurprisingly, this strong exposure to technology has shaped their behaviors and preferences, particularly when it comes to digital payments.
Jacqueline White, president at i2c, discussed Gen Z’s impact on the digital payments landscape in an interview with PYMNTS last year, emphasizing their status as “the first generation of digital natives” with a clear preference for “digital payment methods over traditional ones.”
Notably, Gen Z stands out as one of the leading adopters of digital wallets, including popular platforms like Apple Pay, Google Wallet and PayPal. Their affinity for this payment method stems from the secure, convenient and contactless nature of digital wallets, offering a seamless way to transact online and in-person while safeguarding sensitive payment information.
Research from PYMNTS Intelligence underscores Gen Z’s love for digital wallets, with nearly 80% of them embracing these platforms. This surpasses adoption rates among millennials and bridge millennials, at 67% and 63%, respectively.
Additionally, Gen Z online shoppers are significantly more likely to use Apple Pay, with 8.8% making it their primary payment method, more than double the 4% of millennials who did the same.
Moreover, Gen Z’s interest in digital wallets extends beyond payment functionalities, with 78% expressing interest in using its other features, such as storing information such as passports, driver’s licenses and event tickets. This level of interest significantly exceeds the 51% average observed across all demographics.
Furthermore, Gen Z consumers are also the most likely, at 66%, to consider switching to providers — including bank account providers, credit card issuers, mobile device makers and merchants — offering digital wallet features beyond one-time card payments. This figure outpaces the average across all consumer demographics, which stands at 37%.
Despite their strong embrace of digital wallets, Gen Z’s enthusiasm for connected devices appears less pronounced.
PYMNTS Intelligence’s “How We Will Pay Report: How Connected Devices Enable Multitasking Among Digital-First Consumers” report highlights a surprising trend: a decrease in the average number of connected devices owned by Gen Z from 5.3 to 5.0, contrasting with the modest increase observed across the population.
As PYMNTS explained in a recent report, “several factors might contribute to this phenomenon. One possible explanation could be a shift in preferences or lifestyle choices among Gen Z individuals. As digital natives, they may prioritize quality over quantity, opting for fewer but more sophisticated devices that offer enhanced functionality and connectivity.”
Overall, this subtle decline in connected device ownership among Gen Z hints at evolving preferences and priorities within this demographic. While they readily embrace digital payment innovations, their engagement with connected devices appears more restrained, hinting at a nuanced relationship with technology.
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