Moving Money Around The New Payments Revolution - August 2021
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Moving Money Around
The New Payments Revolution
August 2021
Contents
Executive Summary 3
The Changing Payments
Landscape 7
Credit and Debit Cards 25
New Modes of Payments 44
Summary and Strategic
Considerations 66
Appendix: Survey Methodology
and Demographics 71
About 76
2 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.
From Cash to Cards to Digital
Credit and debit cards are nothing new. Most consumers have one card
However, more consumers are now using linked to those payment methods.
their cards to make purchases and pay bills A successful financial institution must
digitally – either on their phones or motivate consumers to choose its card
computers, without touching the actual card. as that one card.
This is particularly true of millennials.
Digital payments include use of bill-pay
services, person-to-person (P2P) apps like
PayPal and Venmo, stored value accounts
like Amazon and Starbucks, and mobile
payments like Apple Pay and Samsung Pay.
Source: Raddon Research Insights
4 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.People Do Not Always Pay the Same
Payment Frequency Segments
To understand consumer behavior We divided consumers roughly into quartiles:
on payments, we should use
several different lenses. Moderate
One lens is based on frequency. Spenders
The average consumer in our Light Active Big
study makes 23.2 payments a Spenders 27% Spenders Spenders
month. This includes paying bills
and making purchases. 24% 24% 25%
There are distinct differences
based on how often someone
estimates that they use different
payment methods. 1–11 purchases 12–20 purchases 21–32 purchases 33+ purchases
* Average purchases per month
(7.1*) (16.6*) (25.1*) (50.2*)
Source: Raddon Research Insights
Q: Please indicate the approximate number of times per month that
your household conducts such transaction type. (n=1,395)
9 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.Credit Cards Are More Popular Among Older Segments
Percentage of Consumers Percentage of Consumers Using Each Product
With Each Product
91%
83% 81% 82%
77% 80% 77% 76% 75%
64%
6% 4%
11% 7% 1%
Debit Card Credit Card Reloadable or Millennials Gen X Baby Boomers Traditionalists
Prepaid Card
Debit Card Credit Card Reloadable or Prepaid Card
Source: Raddon Research Insights
Q: Do you have any of the following products? (n=1,359)
27 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.Buy Now, Pay Later Programs Are Here and Staying
Use of and Interest in Buy Now, Pay Later Programs
Buy now, pay later programs
Have not used, but interested (BNPL) like Klarna, Afterpay,
25% Have used
and others have exploded
onto the stage, with 28
22% percent of all consumers
32% 14% having used one of these
programs.
55%
41% 13% 11% 37% BNPL finds its greatest
31% popularity among the Credit
13% 13% Driven and Middle Market
Fee Driven Credit Driven Middle Market Low Income Middle Income Upscale particularly.
Depositor Depositor
Source: Raddon Research Insights
Q: Have you ever used a Buy Now, Pay Later program, such as Klarna or Afterpay? (n = 1,395)
49 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.New Payments Continue to Rise, While Cash Is in Decline
Percentage of Consumers Reporting Increased or Decreased Use in Past Year
Thanks to the pandemic,
consumers are changing Increased Use Since Pandemic Decreased Use Since Pandemic
how they make payments. 43%
Forty-three percent of
29% 26% 27% 25%
consumers report 25%
increased online 17% 19%
purchases, while only
-11% -14% -8% -7% -8% -9% -8%
8 percent say their online
shopping has declined.
-31%
Notably, only cash in this
Use credit / Swipe credit / Use mobile Use app on Use app on Use P2P Shop online Use cash
list shows a net decline debit card to debit card, phone to mobile device watch or other service to make to make
in use. conduct or insert card conduct to make wearable device to make purchase purchase
contactless in chip reader contactless purchase to make purchase
purchase to complete purchase purchase
Source: Raddon Research Insights purchase
Q: Which of these person-to-person payment
services do you consider your main or primary
service? (n=846 P2P users)
63 © 2021 Fiserv, Inc. or its affiliates. Raddon is a registered trademark of Fiserv, Inc.About Raddon About Our Parent Company, Fiserv About the Author
At Raddon, we arm financial industry decision Fiserv, Inc. (NASDAQ: FISV) aspires to move Caroline Vahrenkamp is responsible for
makers with objective data gained through our money and information in a way that moves Raddon Research Insights, the Raddon
innovative research techniques and unique the world. As a global leader in payments and national consumer research program, and
database resources. We offer far more than financial technology, the company helps has written 20 research studies since 2016.
data. We provide strategic guidance and clients achieve best-in-class results through a A former finance and marketing executive in
tactical solutions to meet the challenges of the commitment to innovation and excellence in the credit union industry, she uses her
continuously changing financial services areas including account processing and digital nearly 25 years of experience to find trends
industry. Since 1983, Raddon has provided banking solutions, card issuer processing and and patterns in consumer behavior and to
innovative research data, insightful analysis, network services, payments, e-commerce, develop solutions for institutions, particularly
strategic counsel and marketing solutions to merchant acquiring and processing, and the in their strategic planning, product
hundreds of financial institutions across the Clover® cloud-based point-of-sale solution. development and marketing strategy. She
nation. Because we serve financial institutions Fiserv is a member of the S&P 500® Index and earned her bachelor’s degree from Emory
exclusively, we have an in-depth the FORTUNE® 500 and is among FORTUNE University and her Master of Business
understanding of the market and recognize magazine’s World’s Most Admired Administration from Georgetown
critical issues that shape the industry. Companies®. University's McDonough School of
Business.
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