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Sunday, April 21, 2024

Deep dive into digital payment apps

Key takeaways

  • Over half (51%) of Americans use digital payment apps weekly.
  • 34% of Americans feel comfortable leaving the house without their physical wallet.
  • 22% of Americans use a digital payment app to snoop on others’ financial activities.
  • Atlanta, Miami, and Minneapolis are the top 3 cities interested in digital payment apps and platforms.
  • 65% of Americans would trust AI with simple financial tasks like providing account balance updates, while only 41% would trust it to pay their bills, and even less (17%) would trust it to make investments.

10.19.2023

Budget planning, bill paying, and beyond

Digital payment apps reign supreme for many of today’s consumers, shaping how they shop, spend, and save. We explored how these apps are impacting consumer behavior and their financial decision-making and planning.

The appeal of digital payments

The digital payment revolution is in full swing, as over half of Americans (51%) said they’re using these apps weekly. Many Americans agreed their appeal lies in the ability to use them anywhere (69%), making payment processes quick and seamless (66%) and conveniently contactless (59%).

 

Over a third of Americans (34%) — and 40% of Gen Z — leave home without their physical wallets, relying solely on their digital counterparts. On average, Americans stashed $247 in their digital wallets to make purchases and manage spending.

For some, digital payment platforms also inspire curiosity: 22% of Americans confessed to peeping into others’ financial activities through these apps. Generation Z led the trend, displaying a 64% higher likelihood of tracking how others spend on digital apps like Venmo.

The cities embracing digital payment apps and platforms

The results are in: Atlanta, Miami, and Minneapolis are the top three cities interested in digital payment apps based on their searches for them. Residents of Atlanta and Miami were particularly eager to trade in their physical wallets for digital ones, as Atlanta had close to 771,000 searches per capita, and Miami had just under 731,000. Minneapolis was over 150,000 searches per capita behind, with nearly 573,000.

 

Texas also showed a lot of interest in digital payment apps; Dallas, Austin, and Houston all made the top 20 most interested cities list. However, the three most populated cities in the U.S. (Los Angeles, New York City, and Chicago) were notably missing from it.

AI assisting with financial matters: Thanks, but no thanks?

Are Americans willing to use AI to help with money management? Our survey unveiled the top financial actions Americans are willing to entrust to AI.

 

According to our survey, the more complicated the financial task, the less likely Americans trust AI to do it. The top three actions that Americans were willing to entrust to AI include receiving account balances or performance updates (65%), suggestions on ways to grow their savings (60%), and assistance with budget management (58%).

Only 41% were open to the idea of AI taking over the task of paying their bills, and even less (17%) trust it to make investments. Less than 10% of Americans have asked AI to assist them with a financial matter. When it came to making investments, the right financial decisions, or planning for retirement, most Americans said, “thanks, but no thanks” to AI.

Personal finance empowerment

The popularity of digital payment apps and trust in AI to help with simple financial tasks reflect a changing society driven by technology. Although this shift brings more convenience and accessibility to consumers, taking a proactive approach to managing finances can lead to strong financial health over the long-term.

About Empower

Empower is a financial services company on a mission to empower financial freedom for all. We offer investment, wealth management, and retirement solutions for individuals and all sizes of organizations. Connect with us on Empower.com.

 

Methodology: Empower survey of 999 Americans about their financial habits and use of AI, conducted in July 2023 by Fractl on behalf of Empower. Of these, 122 were baby boomers, 238 were Generation X, 503 were millennials, and 136 were Generation Z.  We also collected Google Trends search data per capita for various digital payment apps and platforms. All digital payment platforms were aggregated to determine which cities were most interested in them overall. All data referenced in the article is from this survey.

Fair use statement: Have you ditched your physical wallet for a digital one? Feel free to share this article for noncommercial purposes only; you must provide a link back to the page so readers can access our full findings and methodology.

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Empower Retirement, LLC and its affiliates are not affiliated with Fractl.

Third-party data is obtained from sources believed to be reliable; however, Empower cannot guarantee the accuracy, timeliness, completeness, or fitness of this data for any particular purpose. Third-party links are provided solely as a convenience and do not imply an affiliation, endorsement, responsibility, or approval by Empower of the contents on such third-party websites.

The Currency editors

Staff contributors

The CurrencyTM, a publication from Empower, covers the latest financial news and views shaping how we live, work, and play. We keep you current on ways to plan, save, and invest for life.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. No part of this blog, nor the links contained therein is a solicitation or offer to sell securities. Compensation for freelance contributions not to exceed $1,250. Third-party data is obtained from sources believed to be reliable; however, Empower cannot guarantee the accuracy, timeliness, completeness or fitness of this data for any particular purpose. Third-party links are provided solely as a convenience and do not imply an affiliation, endorsement or approval by Empower of the contents on such third-party websites. 

Certain sections of this blog may contain forward-looking statements that are based on our reasonable expectations, estimates, projections and assumptions. Past performance is not a guarantee of future return, nor is it indicative of future performance. Investing involves risk. The value of your investment will fluctuate and you may lose money. 

Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it authorizes use of by individuals who successfully complete CFP Board's initial and ongoing certification requirements. 

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