Gen Z, those born between the late 1990s and early 2010s, is paving the way forward in how people pay for goods and services. Gen Z is becoming an important segment of shoppers with consumers having about $360 billion in purchasing power. They are also rapidly increasing their online shopping activity with 32% of Gen Z consumers shopping online at least once daily, compared to 25% of millennials and 15% of Gen X.
Gen Z preferences lean toward digital payment methods, and this shift is not only changing how payments are made but is also influencing the broader payments industry. Gen Z’s payment methods reflect a generational shift that emphasises convenience, mobile-first solutions, and a frictionless user experience.
This article shares Gen Z buying behaviour worldwide and some regional preferences so businesses can capture more of this growing market.
Gen Z’s Preferred Payment Methods
- Debit Cards: Gen Z’s Daily Choice
Gen Z favours debit cards over credit cards, with 69% using them daily or weekly. This preference is driven by a strong desire to avoid debt and overspending, aligning with their focus on financial responsibility. In contrast, credit cards—often linked with potential debt and fees—are less appealing, with only 39% of Gen Z using them regularly.
- Digital Wallets and Mobile Payments: Always Connected
Digital wallets such as Apple Pay, Google Pay, and Cash App are becoming some of the most common Gen Z payment methods. In fact, 57% of Gen Z reported using digital wallets in 2021, a figure that has only grown as mobile payment options become more widely accepted. With over 60% of Gen Z citing their mobile devices as their primary tool for purchases.
By not providing digital and mobile payment options, merchants risk repelling customers and losing revenue as Gen Z will priotise merchants that support their preference. If you aren’t accepting Apple Pay, Google Pay, etc, at checkout in-store and online, now is the time to start.
- Buy Now, Pay Later (BNPL): Flexible Payment Solutions
The rise of buy now, pay later (BNPL) services is another standout among Gen Z payment methods. BNPL platforms, like Klarna, Afterpay or Affirm, are a type of short-term financing that allows consumers to make purchases and pay for them in instalments over time. Consumers only need to complete a short application requiring basic information and no hard credit check and can make purchases immediately with little or no initial payment. BNPL is commonly used for online shopping but is also available in some physical stores.
Nearly 70% of Gen Z users take advantage of BNPL for purchases under $100. This option offers flexibility and the ability to make interest-free payments, aligning with preferences of managing spending without accruing debt.
- Peer-to-Peer (P2P) Payments: Fast and Convenient
Peer-to-peer payment systems like Venmo and PIX are also popular with Gen Z, with 39% engaging in these quick, app-based financial interactions. P2P payments allow this generation to quickly split bills, send money to friends, or make purchases without the friction of traditional banking processes.
Merchants can take advantage of P2P payments by opening accounts with popular P2P apps in their regions and displaying QR codes or their username for customers to easily find and pay their business. P2P payments are convenient and flexible payment option for merchants with no special equipment needed and can be more cost effective with lower transaction fees compared to traditional credit card processing.
Gen Z Payment Methods Around the Globe
While some trends are global, Gen Z buying behaviour and payment methods vary across regions.
Brazil: PIX Reigns Supreme
PIX, introduced by Brazil’s Central Bank in 2020, has become a dominant payment method. It allows instant, fee-free transfers 24/7 and has quickly been adopted by Brazil’s Gen Z. Alongside BNPL, debit cards, and even cryptocurrencies, PIX has revolutionised the payment landscape in Brazil, with over 200 million transactions recorded in a single day in 2024.
Germany: Digital Wallets Lead the Charge
In Germany, 65% of Gen Z online shoppers prefer using digital wallets like PayPal for purchases. This preference reflects a global trend of digital-first transactions, though traditional payment methods such as cash and debit cards still play a significant role.
Hong Kong: Mobile Payments and Contactless Solutions
Hong Kong’s tech-savvy Gen Z population is gravitating towards digital wallets such as AlipayHK, WeChat Pay, and international platforms like Apple Pay. Contactless payment systems, like the Octopus card for public transportation and retail, along with QR code payments, also cater to Gen Z’s preference for quick, hassle-free transactions.
UK: A Mobile-First Generation
In the UK, Gen Z consumers are all about mobile payments. Over 55% of this demographic uses mobile wallets like Apple Pay or Google Pay, while 47% report they only take their phone when going shopping. This reliance on mobile wallets underscores the importance of digital-first solutions for businesses looking to engage Gen Z customers.
Attitudes Toward Payments: Convenience is Key
Gen Z’s payment preferences go beyond specific tools—they want a seamless, fast, and frictionless experience.
Frictionless Transactions
For Gen Z, entering a PIN or dealing with slow payment processes is seen as a hassle. They expect payments to be as effortless as sending a text message. The focus is on convenience, with 39% of Gen Z stating they prefer payment processes that require minimal effort.
Data Privacy Concerns? Not So Much
Unlike older generations, Gen Z is less concerned with data privacy. Only 40% of Gen Z view data security as extremely important, compared to 65% of older generations. While this may seem risky, it reflects their comfort with technology and their desire for a streamlined experience over security concerns.
Cash: Not Yet Obsolete
Despite the rise of digital payments, cash hasn’t disappeared completely for Gen Z. About 37% of Gen Z still use cash for in-person transactions, but this number is expected to shrink as digital payments continue to dominate.
The Future of Payments is Digital for Gen Z
From debit cards and digital wallets to buy now, pay later services, Gen Z’s preferences reflect their digital upbringing and their demand for convenien
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