The pandemic decelerated the use of cash and accelerated acceptance of a diverse mix of digital spend channels, the most popular being contactless. Onbe CEO Bala Janakiraman explains why digital-first payments are key to meeting consumers where they are in the PYMNTS eBook, “Endemic Economics: 32 Payments Execs on the ‘Next Normal’ That Never Happened.”
Onbe recently surveyed over 1,000 respondents in our Future of Payments survey to understand what consumers value most when making and receiving payments, what payment methods they’re most open to, which newer payment technologies they plan to try and which modalities they’ll start to use less. Unsurprisingly, we tracked a shift away from cash and toward digital payment modalities, as respondents stated that they plan on using mobile wallets (20%) and P2P apps (19%) more in 2022. And with 65% of consumers believing digital payments are the most secure, nearly 3 in 4 respondents prefer this method of payment as opposed to cash or check.
This shift in mindset was spurred by the COVID-19 pandemic, which decelerated the use of cash and accelerated acceptance of a diverse mix of digital spend channels, the most popular being contactless. This shift continues to gain momentum in 2022, with nearly one-third of respondents saying they plan on using cash and checks less frequently or not at all this year. And online shopping made a huge impact in commerce innovation. As the attractiveness of contactless payments increased, more and more consumers looked to online or in-app purchases. Those ages 18 to 24 showed the most interest in online shopping, with 26% planning to make more online purchases in 2022, compared to 19% of consumers 45 and older.
Not only is offering digital payment options non-negotiable for companies, but consumers really value choice when it comes to payments and disbursements. And by switching to a digital-first payments and disbursement platform, companies can offer consumers their choice of modality — from traditional check to instant, convenient virtual card, push-to-debit and more — along with the option to spend via any channel, such as online or in-app. Innovative organizations will give consumers a variety of payment method choices.
Younger generations especially are embracing cryptocurrency as a payment choice. Our survey revealed that intended usage of cryptocurrency doubled year over year (10%), and that number increases to 40% among those 18 to 44. And while cryptocurrencies typically feature lower transaction fees, extreme market volatility makes them especially risky to those needing conservative investments nearing retirement.
As a result, 58% of 18- to 44-year-olds were more open to owning and using bitcoin and cryptocurrencies than those 45+ (31%). Cryptocurrency has the potential to skyrocket among the younger generations, but they’ll never be interested in using options like bitcoin or cryptocurrency if companies don’t offer it.
The future of payments is digital, and the only way to make the most of that is to meet consumers where they are by offering them choice in payment form and allowing them to shop where it’s convenient for them — online or in-app. By doing this, brands show they understand their consumers and can tailor their services to meet the demands of the market as it changes. Onbe’s vast expanse of payment options brings clients closer to their customers and prepares them for innovation to come.