The analysts at Callahan & Associates field all kinds of queries from clients and curious credit unions regarding data and trends across the industry, within the field of financial services, and among the U.S. population.
A couple of weeks ago, we quizzed our readers on how well they know the Gen Z economy. This week, we’re examining how this digitally native cohort — whose members span from early teens through late twenties — is pushing the payments boundary. Bottom line: Gen Z isn’t waiting for stablecoins to reshape payments; it’s already changing the game with a flourish of clicks, swipes, and shares. From digital wallets to real-time rails, Gen Z habits are redefining how money moves.
What are the notable payment trends among the members of Gen Z?
Andrew Lepczyk: There are a few top-level trends credit unions should be tracking when it comes to payments.
First, members of Gen Z are more likely to use a digital wallet. A 2024 survey by PYMNTS Intelligence found 79% of Gen Z uses a digital wallet. A 2025 report by Billtrust found that number to be even higher — 91%. That same report pegged the percentage of Gen Zers who use a mobile wallet or peer-to-peer payment systems like Venmo and Zelle at 41% and 40%, respectively. Meanwhile, cash usage among zoomers has fallen to 7%.
Debit cards are also popular among younger Americans. According to consulting firm EY, 69% of Gen Z uses debit cards, whereas 39% uses credit cards. By comparison, 51% of older generations use credit cards.
Lastly, Gen Z is flocking to subscriptions, giving this centuries-old payment method new life. In another 2024 PYMNTS Intelligence survey, 26.9% of Gen Z reported using a monthly online grocery subscription while 15.2% used a weekly subscription. Meanwhile, 32.3% reported using an online retail subscription in the past month and 15.2% reported using one in the past week.
What are the benefits of these new platforms?
AL: Easy-to-understand products that require fewer steps is a significant value-add to any kind of payment technology. This goes for any generation, but Gen Z demands it.
Case in point: Easy online access and flexible payment structures has made buy now, pay later a popular substitute for credit cards, especially for large-ticket items. In a March 2025 Bankrate survey, 54% of Gen Z respondents said they used BNPL because they “wanted to pay in installments/spread the cashflow. 33% cited ease and 28% cited interest rates.
As a mobile-first technology, digital wallets are also popular among younger Americans. Gen Z is the first generation to be born into the cell phone-era, so it makes sense its members consider carrying a phone and a wallet redundant.
Finally, subscriptions allow consumers to automatically purchase routine items, which then arrive at their home without even clicking a button. Many subscriptions offer product discounts to boot, which appeals to financially savvy Americans trying to stretch their dollar.
What are the drawbacks to these new technologies?
AL: New technologies always present risk with respect to data privacy, but Gen Z has grown up sharing data via the internet, apps, and more, so privacy is not a significant detractor. In the EY survey, 40% of Gen Z versus 65% of non-Gen Z rated data and privacy as extremely important.
Still, it’s important to note that accessibility and fewer friction points make spending cash a whole lot easier, which isn’t always in the best interest of the consumer. In the March 2025 Bankrate survey, 30% of Gen Z respondents said they spent more using BNPL than they should have and 26% said they regretted a purchase. Those problems can occur with any payment method, but the frictionless transaction associated with BNPL adds an additional sense of free money.
Likewise, subscription users also run into a few payment-related issues. Namely, it’s easy to sign up for a free trial and forget to cancel, which often results in unwanted debits. Secondly, unannounced or lightly announced price hikes can make the cost of subscriptions pile up. Finally, subscriptions are notoriously difficult to track. If users are unsure of how many subscriptions they pay for, the resulting runaway finances can easily blow through budgets.
Do you have questions of your own? Ask an analyst! Drop us a line, and we might feature it in a future post.