Gen Z and Millennial Preferences and Behaviors Drive Popularity of Payments

Mar 31, 2025 | Blog, Payments

By: Primax

Payment preferences continue to evolve and younger generations — consumers ages 18-43 — are reshaping the payments landscape with their expectations. The 2024 edition of the Primax Payments Pulse gauges the current state of payment preferences for 1,850 bank customers and credit union members, most of whom now favor credit cards over debit as their preferred payment method.

Alternative digital payment methods — such as mobile wallets, peer-to-peer (P2P) payments and Buy Now, Pay Later (BNPL) options — are also increasing in popularity, especially among Gen Z, Younger Millennials and Older Millennials.

Here are some additional key generational findings from this year’s study:

Baby Boomers (Boomer+)

Despite concern about the economy, Boomer+ consumers (ages 60 and above) feel more secure about their personal finances than the younger generations. Their first preferred payment method is debit (43%) and they have a lower reliance on revolving credit, with only 8% having applied for a credit card in the last year, which is logical, given their position on the age spectrum. 

  • Takeaways: To ensure these consumers feel supported and secure in their financial decisions, financial institutions should provide a blend of trusted digital tools and traditional in-branch services. With fewer major life changes, Boomer+ consumers benefit from personalized financial solutions like investment products geared toward income generation and preservation of wealth. 

Generation X

Gen X (ages 44-59) consumers are slowly embracing digital payment technologies, with almost half (46%) using a mobile wallet at least a few times per month. Debit is their preferred payment method (45%) for the majority of their transactions. Thirty-nine percent of Gen X – more than any other generation – like to interact with their financial institution through a mobile app. 

  • Takeaways: Despite their interest in interacting with their financial institution through a mobile app, there is still room for further mobile wallet adoption for Gen X when it comes to payments. Banks can educate their customers on how to integrate a mobile wallet into their everyday financial routine — emphasizing that their preferred debit card can be used within the wallet.

Older Millennials

This generational cohort (ages 36-43) is financially savvy and has a flexible approach to managing money. They were early adopters of cryptocurrency, with 72% having invested in or currently holding cryptocurrency. However, despite being comfortable with digital and decentralized currency, they still have an interest in cold, hard cash – with 34% of Older Millennials using an ATM a few times per week for cash withdrawal (58%) and cash deposit (42%). 

  • Takeaways: Financial institutions should consider offering resources or services to support Older Millennials’ interest and investment with cryptocurrency. As this generation relies heavily on ATMs for cash withdrawals and deposits, banks should ensure their ATM networks are robust and surcharge-free.

Younger Millennials

Younger Millennials (ages 28-35) are very tech-savvy and embrace the convenience and flexibility of alternative payment methods. This cohort uses mobile wallet technology more frequently than any other generation, with 51% using the technology at least a few times per week. These young consumers are also the most frequent users of P2P payment accounts like Zelle® and Venmo, with 78% relying on them regularly. Younger Millennials also lead the way in contactless card usage and are avid adopters of newer payment methods like QR codes, social media apps and text payments. 

  • Takeaways: These consumers prioritize convenience. Financial institutions should offer a full host of seamless, secure digital payment solutions and promote them effectively to this audience. Many Younger Millennials prefer to contact their financial institution through social media, so offering real-time support through those platforms can enhance engagement and strengthen relationships with these digitally connected customers.

Generation Z

Gen Z, or consumers between the ages of 18 and 27, are heavily shaping the way we think about money and technology. More than half (58%) pay through social media apps and four in ten (40%) have paid through a QR code. Most (86%) of this generation prefer to use a credit card to build their credit, with more than half (51%) applying for a credit card within the past year. Gen Z also favors flexible payment arrangements, with almost 70% likely or extremely likely to opt for a BNPL option. 

  • Takeaways: This cohort is the most important generation for financial institutions to consider and engage with to drive future growth and remain competitive. Banks should promote products that help this generation build credit while offering flexible payment arrangements. Be sure to develop financial education campaigns focused on responsible credit use and savings, to ensure that Gen Z customers don’t get under water as they look to build their credit for the future. Banks should also offer robust customer support through instant messaging, chatbots or in-app communication tools to ensure a frictionless experience that meets Gen Z’s demand for immediate service.

Enhancing customer experiences and investing in mobile and digital solutions are crucial areas of focus needed for banks to stay competitive in a rapidly shifting payments environment. Consider partnering with a fintech solution provider, like Primax, that can help expand and elevate your financial institution’s offerings to meet the needs and expectations of Gen Z and Millennials — the future of payments. 

Discover more key findings and takeaways to leverage in order to effectively market to customers and achieve continual growth and success. Download the full Primax Payments Pulse today. 

 

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