Radial Research: The Latest Consumer Payments Trends 

Shifts in consumer behavior drive existing and emergent trends. And these trends can either accelerate or dismantle retailers’ growth projections. Modern brands need to build strategies designed to give shoppers what they want—while also mitigating payment roadblocks and potential fraud activity. Radial recently launched a survey on key consumer payments trends, and the results indicate that consumers crave both flexibility and security amid increased economic anxiety. 

Consumers crave payment flexibility when they shop online—and it’s especially true for younger consumers. Eighty-one percent of both Millennials and Gen Z prefer to shop with a retailer that offers multiple payment options compared to 54% of Gen X and only 25% of Baby Boomers. Radial first identified this trend in 2023, and interest has only increased across platforms. Apple Pay, CashApp, and PayPal are currently the most widely used by Millennials and Gen Z. Apple Cash is also popular among these demographics.  

Modern brands need to consider expanding their payment options if they want to attract and keep younger customers. Retailers should provide a mix of payment solutions, as consumers are more likely to use familiar platforms or those where they hold an existing balance. 

Consumers are increasingly uncertain about the economic outlook in the US, and their spending patterns will change in response. Anxious consumers may be less likely to impulse buy and are pre-disposed to abandon carts. Security or fraud concerns contribute to this trend. Per Radial Research, about 35% of consumers overall have abandoned their cart due to lack of payment options, security concerns, or complicated checkouts. Security is especially an issue with younger demographics, where 46% of Millennials and 46% of Gen Z have abandoned carts over frustrating security checks like two factor authentication or CAPTCHAs. And 53% of Gen Z have abandoned carts due to security concerns over transmitting personally identifiable information. The categories most affected by fraud: high-ticket categories like technology and electronics. Over 50% of consumers indicated they are most concerned about fraud.

Per Radial’s survey, 38% of consumers admitted to making a purchase from potentially unsecured websites. Younger consumers fall into this trap more often, with 55% of Millennials and 53% of Gen Z likely to shop on suspicious sites. Just because younger consumers may face fraud attempts to secure a coveted product or deal doesn’t mean brands shouldn’t advocate for high security and fraud prevention. The more transparent brands are about their payment and fraud solutions, the more confident shoppers of all generations will be. Consumers burned by fraudulent sites will quickly shift to sites they know are secure, and security-minded brands benefit from high quality fraud prevention mechanisms. 

“Buy now, pay later” (BNPL) offers consumers an appealing alternative to credit cards or other payment methods by splitting the cost of larger ticket items into smaller installments. Consumers avoid interest payments and can use BNPL to manage their spending. And consumers increasingly adopted BNPL options over the last five years.  

As Gen Z grows up, they are becoming the demographic most prone to use BNPL. More than a quarter of Gen Z shoppers (28%) said they would abandon their purchase if BNPL was not available, suggesting that installment-based payment solutions are becoming essential. 

Despite the popularity of BNPL, retailers should be aware of fraud concerns. Fraudsters can use account takeovers and steal identities, leaving victims stuck with BNPL charges for items they never bought. Brands may also contend with first-party identity risks, where shoppers abandon payments or use false identities with the intent to never make payments in the first place. 

Brands need to assess payments trends and chart a course to win and keep customers, while reducing payment hurdles and fraud issues. To do so, they can seek trusted payments partners dedicated to providing effective solutions for today’s challenges. 

Radial Payment Solutions offers fully managed payment, tax, and fraud prevention to streamline the payments process and tackle fraud challenges. Chargebacks, declined payment methods, fraud, complex taxes, fees, and oversight costs affect brands’ bottom lines. Radial optimizes your payment processes with fraud indemnification, chargeback resolution, and visibility across payment and fraud processes — creating a better experience for retailers and their customers.   

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