Customers are prioritizing convenience and ease-of-use in choosing payment options, according to a survey of 1,750 consumers by the banking payments solutions company Primax.
The survey, taken in June and July, found that consumers were more open to technology and expanding their repertoire of payment options. Sixty-one percent reported using a greater variety of payment methods than they did a few years ago. Nearly six in 10 bank customers plan to use a digital payments option such as Venmo over the next six months.
“Consumers are prioritizing choice and variety when it comes to payment preferences and behaviors,” the report states. “For many, having the option to choose the product, service or offering that fits their needs at a particular time makes them feel more in control.”
A nearly even share said they prefer to either visit a branch, use a bank website or interact with their bank via a phone call. Fewer consumers said they prefer to use the bank’s mobile app, email, or online chat option. According to the report, banks can keep their products relevant to consumer demands by harnessing customer data and taking surveys to better gauge how they interact with their primary bank and through leveraging data to better reach customers through their preferred channels.
“Value propositions like rewards and promotional rates can also help smaller financial institutions keep up and even compete with larger banks,” the report stated. “Nearly six in 10 bank customers reported rewards were important when it comes to their debit or credit usage.”
‘Buy now, pay later’ loans continued to be a popular payment option. Sixty percent who knew that their financial institution offers the option reported using it. Of those who didn’t know, 32 percent said “would be likely or extremely likely to use it”, a 39-percent spike over the past 12 months.
According to the report, bank customers are increasingly interested in cryptocurrencies, NFTs and the metaverse. Though less than 20 percent reportedly hold or have invested in cryptocurrency, 30 percent are interested in learning more about it from their primary bank. The report called on banks to offer counseling on those options and their associated risks.
The report also included generational banking preferences. Americans ages 58 and older most favored credit cards. Those ages 42 to 57 were most likely to say they trust their financial institution. Customers ages 32 to 41 were found to be more debit-leaning than other generations. Those in the 26-31 age bracket were more open to cryptocurrency, NFTs, BNPL and mobile wallets. Though nearly half of Gen Z cardholders said that debit is their No.1 payment method, that dropped from 69 percent last year. Eighty-six percent use contactless card technology at least a few times per month.
“While consumers are showing interest in newer payment methods like contactless cards and mobile wallets, many of them still lean heavily on credit and debit cards,” the report stated. “It is imperative for banks to optimize legacy debit and credit card programs to ensure customers not only reach for their bank-issued card first in their wallet, but across all channels.”