Generation Z is outpacing other generations in using mobile payments as they try to cope with the rising cost of living
A recent survey by Interac Corp. found that 69 percent of Canadian Generation Z adults use mobile wallets, with 63 percent leaving their physical wallets at home when traveling for short periods.
Generation Z’s use of mobile wallets exceeds that of other generations, including Millennials at 60 percent, Generation X at 44 percent, Baby Boomers at 27 percent and the Silent Generation at 10 percent.
Data from Interac shows that Generation Z’s preference for digital payments has led to a 27 percent increase in mobile contactless payments with Interac Debit in the first half of 2024 compared to the same period in 2023.
Of these users, 63 percent have added their Interac debit card to their phones and 31 percent have set debit as their default payment method. The convenience of mobile transactions, perceived as faster by 63 percent of Generation Z, underscores the importance of choosing the right default payment method.
Glenn Wolff, Group Manager and Chief Client Officer at Interac, pointed out that choosing a default payment method can significantly impact spending behavior.
He noted: “When consumers use their phone to pay, they may not realize they are using a standard card. This can lead to higher debt – a situation different from selecting a card from a physical wallet.”
Despite the appeal of mobile payments, 62 percent of Generation Z want to be more conscious about their spending, with 57 percent saying they prefer to pay by debit card in-store or online.
This cautious approach is shaped by economic pressures: 79 percent of Generation Z recognize the increased cost of living and 59 percent recognize the need to be smarter with their finances.
With back-to-school approaching, a time associated with higher spending, Gen Z’s focus on controlling spending is becoming even more pronounced. In September and October of last year, mobile purchases using Interac Debit at family clothing stores nearly doubled compared to January and February.
More than half (54 percent) of Generation Z see the need to develop new financial habits, and 56 percent plan to implement these changes by September.
Wolff added, “As their spending increases in the fall, younger Canadians are making it a priority to stretch their money as far as possible. This generation is most affected by cost-of-living pressures, and it’s no wonder they see the value of Interac Debit as a smart and controlled approach to digital spending.”
