Survey: 'Millennials' see future with cashless transactions

Survey: 'Millennials' see future with cashless transactions

Summary: Proliferation of mobile devices, electronic payments and Internet to spur greater online shopping and eliminate use of cash in transactions, survey finds.

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Millennials believe that new technology will enable the complete dispense of cash in transactions in the future, a Visa survey reveals.

According to the study released Thursday, the transaction behavior of Millennials--defined as those aged between 18 to 28 years old--shows that these young consumers already live the digital life with 63 percent of respondents stating they already transact online using their personal computers or laptops, and 19 percent on their mobile phones. 

8 out of 10 Millennials also believe that one day they will be able to do all their shopping and bill payments online, while 73 percent state this will be possible with a mobile phone.

As consumers become increasingly sophisticated, payment methods must continue to evolve to keep up with, and even lead demand, the report stated, noting that a future where electronic payments will displace cash is already beginning to "take form".

"The ubiquity of the Internet and mobile technology are helping to make electronic payment an intrinsic part of a Millennial's purchasing behavior. [There is] a long future for mobile phone and other device-based payments as more people, especially Millennials, adopt electronic payments around the world," Paul Jung, head of Visa's e-commerce division across Asia-Pacific, Central Europe, Middle East and Africa observed in a statement.

The survey was conducted between Jun. to Jul. 2011, by research agency Millward Brown on behalf of Visa, on 5,500 males and females in the top 50 percent of the income distribution range across Asia, Russia and United Arab Emirates (UAE). The countries included China, Hong Kong, Indonesia, India, Philippines, Russia, Singapore, South Africa, South Korea and the UAE.

Rise of online shopping
It also found that 8 out of 10 Millennials are online shoppers, half of which said they shopped online monthly. Millennials from Korea, Taiwan and mainland China topped the list of online shoppers who shopped once a month--at 76 percent, 53 percent and 84 percent respectively.

15 percent of a Millennial's monthly income goes to online shopping, with the majority spent on general shopping, entertainment, household items, travel and groceries.

The most popular methods of making purchases over the Internet are through credit and debit cards at 40 percent and 37 percent respectively.

"The reality right now however, is that Millennials still use a mix of cards and cash, presenting an opportunity for financial institutions to introduce more people to the convenience and security of using electronic payments," the report said, citing that over half of the payments that Millennials make to pay expenses on tha monthly basis are still done in cash, leaving 44 percent of payments made by cards.

Topics: E-Commerce, Consumerization, Emerging Tech, Mobility, Smartphones

Ellyne Phneah

About Ellyne Phneah

Elly grew up on the adrenaline of crime fiction and it spurred her interest in cybercrime, privacy and the terror on the dark side of IT. At ZDNet Asia, she has made it her mission to warn readers of upcoming security threats, while also covering other tech issues.

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5 comments
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  • Music to the ears of banks and credit card execs.

    People don't understand how much gets skimmed off to pay for the convenience, and how one mistake can cost hundreds or thousands of dollars in fees, fraud and frustration. But far be it from me to teach them, let them learn the hard way.
    terry flores
    • Digital banking saves money

      In the grand scheme of things the banks hijack retailers for a couple percent of purchases. Paying electronicaly costs me no more than paying cash. Though a cash based economy is a very expensive thing. Do you know how long a dollar bill lasts, very short periods of time. The amount of money the federal government wastes buying paper, ink, employing printers and printing the money. Never minde the transportation of the money to federal banks and the desimination of the money into the real world. Is expensive. On top of expensive physical valults retailers have to have on premisis, loss of retail space due to presence of valuts, on top of paying a armored car company to show up to take the money to the bank. It is an infrastructure of ineffeciency. Paying the couple of percent to the credit car companies would be a savings to retailers if they no longer had to deal in cash.
      Peter Pozerski
      • paper money only

        The federal government spent about $500 million to print and deliver paper money last year. Never mind how much it spent to de

        http://www.bep.treas.gov/uscurrency/annualproductionfigures.html

        http://www.slate.com/articles/business/cashless_society/2012/03/cashless_society_how_much_would_the_united_states_save_by_ditching_paper_money_.html
        Peter Pozerski
      • You ought to try pricing some of these services ...

        Merchant credit card processing can cost upwards of 10% for small businesses when you add in all the additional fees. This is passed on to the customers in higher prices for goods. And do you think card machines and telecom lines come for free? All that infrastructure costs money just like tills and deposit boxes do.

        As for how much it costs the government to print money, the US is a *bad* example to quote, they spend five times as much as countries such as Singapore and Switzerland do to create and manage their currency.

        And again, you completely gloss over the fraud and misprocessing risks which run anywhere from $48 Billion to $110 Billion depending on whose stats you believe (Javelin Strategy & Research, February 2009 study). Not to mention the $23 Billion in surcharges and late fees that would be lost by the banking industry if we just paid with cash in our pockets instead of "funny money" cards with hidden rules and gotchas.

        But like I say, it's up to people like you to fund the multi-million dollar bonuses of the banking execs, I'll keep my money in my pocket, thanks.
        terry flores
  • Vote for me and I'll take care of you

    I saw an interesting interview with Gift Ngope, the first professional baseball player from South Africa. He was talking about how much more freedom there is in South Africa, a place where "you can do what you want." By comparison, the U.S. is full of rules and restrictions.

    It saddens me, but the guy is right. People in the U.S. are voting themselves right into a police state, for some combination of security and convenience. When "the machine" knows everything you buy and everywhere you go, you'll be a barnyard animal... coddled, fed, and kept secure by your keepers. Won't that be great?
    Robert Hahn