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Mobile Wallet adoption Up 267 percent with U.S. Millennials, who are dumping their Credit Cards Published-Aug 26, 2016
There's an abundance of evidence suggesting that digital payments and mobile wallet usage is on the rise, especially among the 18 to 34 set.

But a brand new study from Bank of America really takes the cake, and demonstrates why there's a great chance that you'll be paying for that cake via PayPal, ApplePay or another mobile wallet payment option, sooner or later.

According to Bank of America's July 2016 Consumer Spending Snapshot (which tracks the spending of the financial behemoth's 40 million credit and debit customers), mobile wallet transactions are up 249% on a year-to-year basis, while mobile wallet spending is up 222% in the same timeframe.

Demographically, it's younger financial consumers leading the charge, as it always is when technology and financial payments merge. The study shows mobile wallet transactions are up 267% with Millennials, while mobile wallet spending is up 235%.
 
Generation X isn't that far behind. There, mobile wallet transactions have risen 252% on a year-to-year basis, and mobile wallet spending has spiked by 234%.

Perhaps that burst in usage among consumers from 20 to 50 are why credit card usage is in rapid decline these days.

A separate study - this one from TD Bank - shows that almost half (44%) of Millennials aren't using credit cards at all. Even with mobile's ascent that figure doesn't sit well with financial payment industry insiders.

"When asked what is the biggest benefit of using cash, most Millennials said using cash ensures they spend within their means and one-fifth say they worry using a credit card will make them incur debt," says Julie Pukas, head of U.S. cards and merchant solutions at TD Bank. "However, strategically using credit for regular purchases can help Millennials keep track of their overall budget.

Using a mix of payments is important, Pukas adds, but without balancing spending on credit, Millennials are "passing up cash rewards and the opportunity to establish the credit they'll need for purchases down the road."

When any financial payment option rises by more than 220% in only a year, you know you've got a gold-plated trend on your hands. And the experts say mobile financial transactions are still only in first gear.

"The proliferation of technology and emergence of connected devices have created an opportunity for companies not previously in the payments space to jump into the ring," says John Shapiro, director of product management for Payments at Intuit. "This is disrupting how payment solution providers think of traditional competitors, forcing them to expand their product offerings, and consequently giving consumers more ways to make a purchase and businesses more ways to get paid."

Shapiro points out that Gartner reported recently there will be 6.4 billion connected devices worldwide in 2016, up significantly from 2015, and the number is expected to reach 20.8 billion by 2020. "If you're noticing that this is well more devices than people, you're right-connected devices and sensors will permeate the environment, unlocking improved and simplified experiences."

"That means businesses will no longer be concerned about how they'll get paid - consumers will be able to use their mobile wallets or connected devices to complete their transaction, helping businesses get paid faster and improving convenience for both sides," he adds.

While growth is high in the mobile wallet sector, Shapiro says providers should take a page out of big retailer's mobile playbooks to boost usage.

"Pairing payments with other benefits, like loyalty, has proven to be a winning recipe for Starbucks, for example. And, while eliminating the payment from the customer/business interaction has helped accelerate Uber's growth," Shapiro states. "Offering reasons for users to adopt and creating an easy way for merchants to transition to mobile-friendly solutions will influence the success of mobile wallets."

Younger financial consumers already get that, at a 250% usage rate rise almost across the board.

Thus, the data is clear now - the mobile revolution is here, and Millennials are leading the way.
 
 
Sourced By: business-news.thestreet.com

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