More Americans Expect All Payments to Go Digital, Survey Finds

A new survey conducted banking platform provider Temenos has found that three in five Americans anticipate that all payments will become digital in the near future. This expectation rises to two-thirds among millennials. The survey also highlights the increasing adoption of cashless methods, with 24% of respondents never or rarely using cash. Instead, they prefer mobile banking and payment apps.

The survey, which gathered responses from 2,000 US adults, reveals that 71% use mobile or online banking for payments, with 36% conducting account-to-account transfers through wire or ACH at least once a month. Additionally, more than half (53%) utilize payment apps such as PayPal or Venmo, while 41% make use of mobile wallets like Google Pay or Apple Pay. The study also shows that 26% of respondents use QR codes for payments and 16% use some form of cryptocurrency.

The launch of instant payment initiatives like FedNow is expected to further incentivize Americans to embrace digital payments. The survey found that over a third of Americans believe that bank transfers are currently too slow and expensive. However, when it comes to sending payments, 51% of respondents would only trust their bank or credit union. Security and protection from fraud, privacy, and trust in the brand are the three most important factors for consumers in relation to digital payments.

The survey also reveals that younger generations are driving the adoption of new payment methods. Both Generation Z and millennials are the most dissatisfied with the speed and cost of bank transfers. Additionally, over 50% of them expect to use online banking, contactless payments, and payment apps more frequently in the coming years, compared to only around one-third of older generations.

In response to the survey findings, Erika Baumann, Director of Commercial Banking & Payments at Datos Insights, stated that the increased adoption of digital payments is influenced market innovation, a wider range of payment options, and a surge in transaction volumes. She emphasized the importance for banks to review their payments infrastructure and technology choices in order to adapt to and capitalize on these changes.

Patrick Gauthier, CEO of Convera, highlighted that the move towards a cashless society is a global phenomenon driven consumer adoption and the digital transformation of businesses. He sees this shift as an opportunity for innovative payment providers like Convera to partner with companies like Temenos in order to modernize payment platforms and facilitate simple and secure money transfers.

Philip Barnett, President of Americas at Temenos, acknowledged that American consumers are demanding faster, cheaper, and more convenient methods of payment. He highlighted that Temenos is working with financial institutions of all sizes to help them modernize their payments systems and take advantage of market changes. Temenos’ cloud-native and API-first platform enables banks and non-banks to progressively update their payments capabilities and benefit from new initiatives like FedNow.

Sources:
– Temenos survey “Cashing in on the rise of digital – key trends in US payments”
– Erika Baumann, Director of Commercial Banking & Payments, Datos Insights
– Patrick Gauthier, CEO, Convera
– Philip Barnett, President – Americas, Temenos
– Temenos’ FedNow Service certification, IBS Intelligence Sales League Table.