How the age of a consumer affects payment method preference.

Business tips
Jereme Sanborn


Accepting more payment methods is generally considered a smart way to increase sales, but how can you predict which types will be the most lucrative? If you know the age demographics of your target audience, you can determine which payment devices are best for tailoring your point-of-sale (POS) system to your customer base.

Older consumers: tentative technology adoption.

Consumers born between 1927 and 1964 are divided into two segments:

  • The “silent” generation (1927 to 1945)
  • Baby boomers (1946 to 1964)

In both groups, cash, debit cards, and credit cards are the preferred ways to pay. Surprisingly, despite only 60 percent of people older than age 65 being active on the internet, these generations also use electronic payments 10 to 12 percent of the time.

Mobile wallets, on the other hand, aren’t terribly popular with the older crowd. Just 30 percent of the silent generation owns a smartphone and of the 56 percent of boomers who have invested in newer technology, only 17 percent use payment apps. The majority of older consumers, particularly those over 65, appear to prefer writing checks over paying electronically or with mobile devices.

The younger crowd: happily embracing digital payments.

Generation X, comprised of people born between 1965 and 1980, bridges the gap between older consumers and the youngest generations and so do their preferred payment methods. Although they tend to gravitate toward credit and debit cards, about 22 percent of Gen Xers also use peer-to-peer payment apps to send and receive money.

The infamous millennial generation, born between 1981 and 1999, uses payment apps slightly more often, with 50 percent regularly relying on smartphones to make payments. Over half of millennials also use credit or debit cards even for their smallest purchases, despite cash still being the preferred method for about one-quarter of all purchases made by younger generations.

Consumers born after 2000 are branded “Generation Z” and use payment apps much more frequently than Gen X or millennials. However, they tend to gravitate toward debit card payments more often, which is also characteristic of the other two groups.

What payment preference statistics mean for your business.

It’s not hard to translate these statistics into strategic changes in the payment types you accept. If your products or services cater to an older crowd, you probably don’t have to upgrade your POS to accept mobile wallet payments. However, if you’re serving a ton of millennials, you’d better look for a payment processor with and the right tech (and reasonable fees) for accepting everything from cash to the most popular payment apps.

Before investing in new payment devices, compare age and payment statistics to the information you’ve gathered on your own customers. Looking at the two sets of data together can give you a clear idea of which payment methods people are already using and where a lack of choice may be causing you to lose customers. Upgrade your POS accordingly and continue to track payment data to see how the change affects sales!

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