Just as credit cards have grown to replace cash, digital payments will soon take the place of credit cards.
In less than a decade, digital payments will likely be made through phone apps, smart watches, or even biometric triggers.
According to recent consumer survey data from the US Federal Reserve, 24 percent of consumers have used a form of mobile payment in the past year. Mobile payments include in-app purchases or use of an application to transfer money. PayPal also released survey data that indicates a pattern of distrust towards credit cards among millenials. 34 percent of those surveyed described credit cards as “old school.”
People may be skeptical about mobile payments, but digital transactions are actually more secure than credit card transactions. Millennials and Centennials (Generation Z, born in the late 90s) now see credit cards as outdated and vulnerable. Apple Pay renders plastic cards obsolete in many ways. Mobile applications such as Uber enable transactions automatically. The new consumer generation is more inclined to trust large technology companies. In the future, Apple or Google may be more trusted as a payment broker than Visa or Amex.