3 in 5 Americans Expect All Payments to Become Digital
According to a new Temenos survey, “Cashing in on the rise of digital – key trends in US payments”
News provided byTemenos
Sep 19, 2023, 6:30 AM ET
NEW YORK, Sept. 19, 2023 (GLOBE NEWSWIRE) -- Three in five Americans (58%) expect all payments to be digital in the near future, rising to two thirds among millennials (67%), according to a new survey “Cashing in on the rise of digital – key trends in US payments” for banking platform provider, Temenos. This comes as US adoption of instant payments is set to soar following the launch of FedNow and growing competition and collaboration between banks and fintechs to offer a range of innovative payment solutions.
According to the Temenos survey of 2,000 US adults, almost a quarter (24%) never or rarely use cash (less than monthly), preferring to use cashless methods such as mobile banking and payment apps. Of those surveyed, almost three quarters (71%) use mobile or online banking for payments with over one third (36%) sending account to account transfers via wire or ACH at least monthly. Over half, 53% use a payment app like PayPal or Venmo at least monthly while 41% use a mobile wallet such as Google Pay or Apple Pay. Just over a quarter (26%) use QR codes for payments, while 16% do so using some form of cryptocurrency.
The introduction of new instant payment initiatives such as FedNow gives banks an opportunity to elevate the customer experience and grow their payments business. More than a third of Americans surveyed say bank transfers today are too slow and expensive, yet half (51%) would only trust their bank or credit union when sending payments. In fact, when thinking about digital payments, security and protection from fraud (50%), privacy (40%) and a trusted brand (39%) are the most important factors for consumers.
Adoption of new payment methods is being driven by younger cohorts. The survey finds Gen Z (18 to 25-year-olds) and Millennials (26 to 41-year-olds) are the most dissatisfied with the speed and cost of bank transfers. Further, more than half expect to use online banking, contactless and payments apps more in the next few years, compared to only around one third for older generations.
Erika Baumann, Director, Commercial Banking & Payments, Datos Insights, said: “At Datos (formerly Aite-Novarica Group), we are seeing increased adoption of digital payments in the US. A lot of factors are influencing this shift including market innovation, increasing choice of payment options and a surge in transaction volumes. As the shift to digital payments continues, more banks are reviewing their payments infrastructure with specific focus on technology and platform choices which enable them to innovate and scale as their business evolves.”
Patrick Gauthier, Chief Executive Officer, Convera, a global payments leader, said: “The move to a cashless society is gaining momentum in America as this Temenos survey shows. It’s a global phenomenon reshaping the payments landscape, driven by consumer adoption and the digital transformation of all businesses, creating opportunities for innovative payment providers like Convera. This is why we are partnering with Temenos to modernize our payments platform in the cloud, and help customers move money with simplicity and confidence.”
Philip Barnett, President – Americas, Temenos, commented: “It's clear from this survey and our conversations with US banks that American consumers are looking for faster, cheaper and more convenient methods of payment. Temenos is working with US financial institutions of all sizes to modernize their payments capability to adapt and take advantage of these market changes. And we continue to invest in our single code base across core accounts and payments processing, making our offering the most compelling in the market.”
Temenos’ cloud-native and API-first platform with proven localization and ongoing investment in the US, enables banks and non-banks to progressively modernize their payments capability, giving them the business agility needed to enable innovation and benefit from new market initiatives such as FedNow. Temenos recently achieved the FedNow Service certification. Temenos is also a global market leader in payments, consistently ranked the top-selling payments system in the IBS Intelligence Sales League Table.
Hear more from Temenos on payments modernization at Sibos 2023, the global financial services networking event in Toronto, 21-23 September.
About the Research
Temenos commissioned professional polling partner Opinium to identify trends in payments and adoption of digital payment methods in the US. A nationally representative sample of 2,000 US adults were surveyed by Opinium Research as part of the Consumer Omnibus Survey in July 2023.
Temenos (SIX: TEMN) is the world’s leading open platform for composable banking, creating opportunities for over 1.2 billion people around the world every day. We serve 3000 banks from the largest to challengers and community banks in 150+ countries by helping them build new banking services and state-of-the-art customer experiences. The Temenos open platform helps our top-performing clients achieve return on equity three times the industry average and cost-to-income ratios half the industry average.
For more information, please visit www.temenos.com.
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