Digital payment technology and embedded finance is continuing to grow in popularity, new research from Marqeta has revealed.
According to its fourth annual 2023 State of Payments Report, which surveyed almost 4,000 consumers across three continents, almost three in four mobile wallet users said they would now feel confident enough to leave their wallet at home and only rely on their phone for making payments, up from 61% in 2022.
With the rise of embedded finance and digital financial services, the survey shows how these new payments and shopping solutions have become commonplace alongside legacy systems. Consumers today are working with multiple financial services providers and using a range of digital payment tools and embedded financial services for a more unified shopping experience.
In addition, it revealed that 86% of US mobile wallet users have made a purchase via a retailer’s embedded mobile app, a primary driver being a stronger payment reward system. The demand for frictionless checkout was also high, with 43% of respondents saying they have abandoned a purchase because it required them to download a new app or payment method.
The report shows that consumers are increasingly balancing their loyalty to legacy providers and their desire for superior user experiences. Traditional and digital-first finance options have become intertwined, and instead of giving up either one, consumers are opting for multiple financial services providers to meet their needs.
Consumers haven’t yet abandoned their primary or traditional banks with over three in four saying they used traditional banks as their primary providers while 42% US consumers said they use both traditional and digital banking providers. Meanwhile, 80% of US consumers reported using peer-to-peer (P2P) payment transactions at least once.
