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Gen Z and their digital payments expectations

First, let us introduce you, the reader, to our subjects: Generation Z lives in the most digital era of humankind and is one of the most skillful generations in mobile and digital payments. Financial technology (Fintech) companies are turning banking and payment challenges into opportunities and new solutions.

Fintech means a plethora of software development platforms and applications that can change financial services by stimulating the growth of new business models, applications, processes, and products.

What is Fintech: why should I care about it?

Fintech is the new tech that improves and automates the delivery of financial services. Fintech helps consumers and business owners manage their financial operations. It works by using specialized software and algorithms that are used both on smartphones and computers.

Despite the challenging economic environment in 2020, Fintech investments grew, reaching $44 billion, a 14% increase over 2019.

Digital payments industry during the ages

In 2008, the economic and financial crisis led to the development of Fintech and digital payments. Digitalization is actively transforming the economy today. Based on the statistics, the next-generation payment technology market is forecasted to grow globally between 2015 and 2022. In 2017, a global estimate of 3.1 trillion U.S. dollars was reported for the transaction value of the next-generation payment tech market.

Next-generation technology payment systems include chip EMVs, QR codes, and NFCs/contactless digital payments. The NFC’s adoption of mobile handsets grew the NFC segment at the fastest rate. In 2022, EMV chips (Europay, MasterCard, and Visa) are expected to conquer the market.

Who is Gen Z, and why are they so powerful?

Generation Z is the name of the present generation of youth born from 1997 to 2012. Many Gen Zers have already taken on adult responsibilities, starting climate movements, organizing marches for social justice, and pushing companies to align better with their values.

Gen Z consumers are raised and grown in the digital age, which makes them digital natives. They are comfortable opening deposit accounts online and using their mobile applications for different forms of Fintech, such as digital banking.

Reshaping the financial experience: Gen Z and their expectations in digital payments

Gen Z has different expectations when it comes to financial services. The digital natives crave something bespoke to their particular requirements and interests — such as real-time data and easy digital payments. These consumers expect fast decisions, automated digital experiences, and personalized offers.

We are experiencing instant gratification provided by technology. Gen Z is affected in many ways by living a digital life. Today, they only have 8 seconds attention span.

Gen Z consumer behavior in digital payments: Predictions

Millennials with Gen Z will make up 72% of the world’s workforce by 2029. The world of commerce in the following years will be driven by the purchasing power and leverage of these two generations. Accommodating boomers and Gen X remains essential, of course, but capturing the loyalty of millennial and Gen Z consumers will be even more vital to businesses’ long-term success. Combined, Gen Z & Millennials already have around $350 billion spending power in the U.S. alone. Gen Z’s commercial power is the fastest flourishing of any generational cohort. Their income is expected to increase fivefold by 2030 to $33 trillion as they enter the workplace—balancing the books for over a quarter of the global revenue.

To attract and retain these generations, it is critical to understand their purchasing behaviors and adopt preferred Gen Z and millennial payment methods to ensure a seamless, optimized experience—whether you’re a business selling goods or services or an issuer of cards and other digital payment solutions.

AROBS develops fintech solutions based on your company’s vision using the latest software technologies in the industry so that you can provide the best service for your customers.