Comedian Jerry Seinfeld nicely summed up the current state of digital transformation in a recent Netflix comedy special. Noting the subtle evolution of language over time, he observes that people “get on a train, and in a cab, but you take an Uber.” He then concludes: “You take it! You take Uber! Because there’s no money. It’s like free.”
Now, Uber is not free, of course. Anyone who has ever looked at their credit card statement after their teenage kids spent a weekend ordering fast food deliveries and shuttling themselves to and from friends’ houses can attest to that. But the germ of truth in Seinfeld’s comment that makes it so funny is that when you are using Uber—in that moment—it feels like it’s free. That psychology is creating a dangerous paradox for the millions of Americans now using digital payments, buy now pay later (BNPL) services and mobile wallets to pay for everything from dining and ecommerce to rent and utilities.
To get a clearer sense of how Americans are using these digital payment alternatives, the J.D. Power Banking and Payments Intelligence team conducted a pulse survey to evaluate user experiences with different services and asks how the growth of these services is affecting overall financial health. Ultimately, the research finds that digital transactions are rising in popularity—with credit and debit cards still leading the way in overall utilization—while BNPL, mobile wallet and person-to-person (P2P) payments are earning high customer satisfaction scores, particularly from younger customers. The research also finds that digital transactions are making it easier for young customers to overspend.
Read the Full Banking and Payments Intelligence Report >