Interac Corp. has unveiled striking insights into the payment preferences of young Canadians. A recent survey commissioned by the company reveals that Generation Z is at the forefront of a digital payment revolution, with nearly seven out of ten Gen Z adults in Canada adopting mobile wallets for their transactions.
The survey, conducted in July 2024, shows that 69% of Gen Z Canadians, aged 18-27, have integrated mobile wallets into their daily lives. This adoption rate significantly surpasses that of other generations, with Millennials following at 60%, Gen X at 44%, Baby Boomers at 27%, and the Silent Generation at just 10%. The trend is not just a matter of preference; it’s reshaping the very nature of how young Canadians interact with their finances.
Interac’s transaction data corroborates the shift, reporting a 27% increase in Interac Debit mobile contactless payments during the first half of 2024 compared to the same period in 2023. The surge is largely attributed to Gen Z’s digital-first habits. The convenience factor plays a significant role, with 63% of Gen Z mobile wallet users perceiving mobile transactions as faster than physical card payments.
However, the convenience comes with potential pitfalls. Glenn Wolff, Group Head and Chief Client Officer at Interac, warns that the ease of mobile payments could lead to unintended spending habits. “Choosing your default payment method may feel like a small step, but it can play a big role in shaping Canadians’ ongoing spending habits,” Wolff explained in a statement. He emphasizes that unlike traditional wallets where users consciously select a card for each transaction, mobile payments can occur almost on autopilot, potentially leading to unintended use of credit over debit.
The shift in payment methods is occurring against a backdrop of economic pressures. The survey found that 79% of Gen Z Canadians believe the cost of living is too high, and 59% feel compelled to be more prudent with their finances. As a result, 62% of Gen Z respondents expressed a desire to be more mindful of their spending habits.
The back-to-school season traditionally brings increased spending, particularly in clothing stores. Interac data from the previous year showed that family clothing stores experienced nearly double the Interac Debit mobile purchases in September and October compared to January and February. Recognizing this pattern, over half of Gen Z survey respondents (54%) acknowledged the need to develop new financial habits, with 56% setting September as a target to implement these changes.
Wolff notes that younger Canadians are particularly focused on maximizing their purchasing power as expenses rise. “This generation is among the worst hit by cost-of-living pressures, and it’s no wonder that they see the value of Interac Debit as a smart and controlled approach to digital spending,” he added.
The survey, conducted by Hill & Knowlton using the Leger Opinion online panel, sampled 1,500 Canadians from July 11 to 16, 2024. The results were weighted according to 2021 census figures for age, gender, and region, with a margin of error of ±2.5%, 19 times out of 20.
