Digital Wallets Now Power 16% of Online Purchases

The way consumers shop online is shifting, and payment preferences are leading the change. According to a new PYMNTS Intelligence report, eCommerce for All: How Consumers Across Generations Make Purchases Online, digital wallets are gaining real traction, now accounting for 16% of online retail purchases.

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Online vs. In-Store: Different Rules Apply

In physical stores, debit cards remain the undisputed leader. Forty-two percent of consumers used debit for their last in-store purchase, outpacing credit cards. But online, the pattern flips. Thirty-eight percent of consumers prefer credit cards for digital transactions, often citing stronger security protections in the digital environment.

Digital wallets stand out in eCommerce, doubling their in-store usage to reach 16%. Their ease of use, speed, and ability to store multiple cards securely are driving this adoption, especially among younger shoppers.

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Generational Differences

While overall eCommerce adoption for retail and travel has stabilized across age groups, categories like groceries and restaurants show clear generational divides. Gen Z and millennials are far more likely to buy meals or groceries online, with Gen Z being 72% more likely than baby boomers to make their last restaurant purchase digitally.

Digital natives are comfortable using wallets, apps, and online platforms for everyday spending, while older generations remain more cautious with necessities and discretionary items.

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Merchants Matter

The report also highlights merchant loyalties split by channel. Amazon leads the online space, while Walmart dominates in-store. Payment preferences often align with merchant choice: debit card users gravitate toward value-focused retailers like Walmart and dollar stores, while credit card users tend to prefer Amazon for online shopping.

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What This Means for Merchants

The findings reveal three clear takeaways:

• Security drives online payment choices. Credit cards and wallets dominate digital transactions because of fraud protections and consumer trust.
• Debit still rules in-store. Value-driven shoppers rely on debit cards for managing budgets in physical retail.
• Digital wallets are gaining ground. Their rapid growth signals that merchants should integrate wallet acceptance to capture a larger share of online purchases.

As the digital landscape evolves, merchants and payment providers alike must adapt to shifting consumer preferences. Security, trust, and flexibility will define the future of payments.

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Payment Solutions with Kubera Payments

At Kubera Payments, we help businesses across North America move millions of dollars daily, whether in-store, online, or on mobile. Our team of payment experts is here to guide you through the complexities of payment processing, ensuring your transactions are secure, reliable, and PCI-compliant. We have strong relationships with a wide network of acquirers and can help you find the right front-end and technology solutions to work together.

Get expert advice on optimizing your payments.

Contact our team at sales@kuberapayments.com or 604-484-9278

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