Gen Z consumers (ages 18-28) toggle between physical and digital payment methods with ease. Their need for flexibility is driving innovation and change in the payments ecosystem.

Released annually since 2018, Velera’s 2025 Eye on Payments study gauges the current state of payment preferences among credit union members and other financial institution customers (“non-members”), while exploring the factors that influence these trends. Results of this year’s Eye on Payments study found that most consumers equally prefer credit and debit — and the choice of which to use is driven by situation and opportunity. This previous blog explores more of those key findings.

The study also revealed that generational preferences continue to evolve, shaped by technology, trust and convenience. Here are some key generational findings from this year’s study:

Baby Boomers (Boomer+)

Boomer+ consumers, ages 61 and above, prioritize personal connection and straightforward digital tools. While nearly four in ten (39%) now use a mobile wallet — up significantly from just 25% in 2024 — most still prefer physical cards. Life stage transitions are limited, with retirement (8%) being the most common change, likely leading to more than half (56%) being uninterested in any new lending products. Boomer+ consumers report the highest trust in their financial institution (96%) and rely heavily on traditional channels, with 61% visiting branches and 42% using phone calls, though many also access online banking (53%). This generation also values rewards, with 58% reporting they are important in credit card use.

Takeaways: Personal connection remains key for Boomer+ consumers. Credit unions should prioritize branch and phone support alongside straightforward digital tools that facilitate adoption without overwhelming members. As rewards programs are important to this demographic, credit unions should ensure rewards offerings are simple and value-driven. Credit unions should reinforce Boomer+ consumers’ loyalty by emphasizing consistency, fraud protection and dependable service, while gradually introducing convenient digital payment options, like mobile wallets.

Generation X

Gen X (ages 45-60) leads with a debit-first mindset and security is their top priority. Gen X reports fewer major life events compared to younger cohorts, yet career and family still influence their finances. Almost half (45%) prefer a physical or mobile debit card as their top payment method — more than any other generation. Security is also a defining concern, with 83% being very concerned about it, the highest of any generation.

Takeaways: Gen X consumers are selective in their borrowing, and credit unions should position lending products as practical tools for life-stage demands like career changes or children going to college. Security is their top priority, especially concerning identity theft. Credit unions should reinforce the security of their debit-friendly offerings to best meet Gen X’s expectations.

Older Millennials

Older Millennials, ages 37-44, are in a stage of established adulthood, balancing career growth, family responsibilities and a wide range of financial commitments. Nearly half (48%) use mobile wallets weekly, while one-third (34%) prefer tapping a contactless card. They are the most rewards-driven generation, with 85% saying rewards are important in credit card usage and 90% saying rewards motivate them to use their credit cards more. Security is a pressing concern, as 13% have experienced card fraud in the past year. Older Millennials are a versatile cohort focused on rewards, convenience and protection.

Takeaways: Older Millennials are defined by financial complexity. They are more open to a variety of credit and lending products and their rewards-driven mindset shapes how they evaluate financial institutions. Credit unions should design rewards programs around everyday value to resonate with this cohort. To earn Older Millennials’ long-term loyalty, credit unions should deliver frictionless digital experiences with strong protections and proactive education.

Younger Millennials

Younger Millennials (ages 29-36) are balancing major life milestones with a need for flexible financial tools. Nearly half experienced a significant event in the past year — such as buying a home (16%), changing jobs (14%) or starting a family (10%), all of which drive more complex financial needs. Younger Millennials are very open to new payment methods, as 32% have paid by text and 34% by QR code. This generation also places a premium on support, as 88% report they would use educational resources from their financial institution if offered. With about 10% having recently faced fraud or identity theft, security is also top of mind – which is why 84% rely on phone alerts to help them prevent fraud.

Key Takeaways: More so than other generations, Younger Millennials seek financial institutions that can provide practical tools during critical life milestones. They have an appetite for variety and convenience, which shows in their openness to new payment methods, as well as for financial education and strong security measures. Credit unions should combine innovative payment options with proactive advice and robust protections to best support Younger Millennials through these formative financial years.

Generation Z

Gen Z is hungry for flexibility and knowledge as they strive for financial independence. This generation prefers using multiple payment methods, depending on which best suits their needs and is most convenient for a particular instance. Cash and physical cards are preferred in nearly equal measure, with a slight preference for using a credit card stored in a digital wallet (22%). They are comfortable using P2P, with 39% reporting accounts like Zelle and Venmo are a primary method of payment. Gen Z is also extremely comfortable utilizing the digital assistance of AI, with 80% already using AI for budgeting and planning. At the same time, Gen Z is hungry for knowledge and flexibility as they develop financial independence. Nearly nine in ten would use financial education resources if offered by their financial institution — more than any other generation.

Takeaways: Gen Z is digitally fluent‚ toggling between cash, cards, wallets and P2P with ease. They also trust having AI assist with budgeting, planning and transactions. Credit unions that prioritize connectedness — allowing members to move seamlessly between channels and tools — will meet Gen Z where they are and earn early loyalty. Gen Z is also eager to learn, so credit unions should embed financial education into the banking experience to stand out as trusted partners for the long term.

The greatest opportunity for credit unions to meet the needs and expectations of Gen Z lies in pairing innovation with connectedness and education to become trusted partners. Not sure how to do so? Consider partnering with a fintech credit union service organization (CUSO), like Velera, that can help. It is critical for credit unions to earn the loyalty of Gen Z, while remaining central to the lives of members across the generations, to stay competitive in an increasingly complex payments landscape.

Discover additional findings that your credit union can leverage to effectively market to members and achieve continued growth and success by downloading the full 2025 Eye on Payments white paper today.