Demographics Determine Payment Preferences

The European Central Bank found out that the demographic factor determines consumers’ payment preferences.

Payment

Consumer demographics determine payment preferences. Source: Pixabay

The conclusion about the relationship between payment preferences and the demographic factor is contained in the ECB study on the behavior of bank customers in the Eurozone. This study has shown that in the period from 2019 to 2022, the behavior of Europeans when shopping has radically changed. Also, residents of European countries began to pay more for goods than in any other three-year period in the history of observations.

Changes in behavior in the sphere of making payments are obvious. For example, in 2019, 72% of consumers paid for goods in cash. By the end of 2022, the share of these transactions was 59%.

In 2016, the level of cash use was 79%. For this reason, there is no reason to claim that the coronavirus pandemic has played a significant role in changing the behavior of Europeans when making payments. The trend of choosing contactless payment methods was formed earlier.

Last year, the ECB reported that when making one-time transactions, the share of online payments in the Eurozone was at least 10%. In some countries, this figure was much higher. For example, in Belgium, the share of online payments when making one-time transactions was 24%. In Austria and France, this figure was equal to 21%.

It’s important that contactless payments have bypassed cash transactions in terms of cost. This means that consumers use contactless payment methods when buying more expensive goods.

The ECB study also showed that the share of online payments depends on the age of buyers. For example, in the age group from 18 to 24 years, the level of use of contactless payment methods is lower than in the category from 25 to 39 years. But this means a lower purchasing power of the younger group and not its conservative approach. Across the Eurozone, shoppers aged 25-39 made 22% of their purchases using online payments.

As we have reported earlier, Digital Payments Replace Wallets.