Online retailers that don’t support digital wallets are losing Gen Z customers

Generation Z, the generation widely considered to be digital natives, is particularly discerning when it comes to online shopping, according to a new study. Online shoppers frequently browse sites, fill their cart and head to checkout – only to abandon the purchase if their preferred digital wallet is not available for payment, according to a recent study from global data and analytics platform PYMNTS Intelligence. And this phenomenon is particularly pronounced among Generation Z.

More than a third (36%) of Gen Z shoppers have abandoned a cart in the last 30 days because they couldn’t pay as they wanted, 1.7 times the overall average, followed closely by Millennials at 31%. Collectively, 40 million consumers in these two age groups abandoned their planned purchases in a single month, the study found, leading to huge profit losses for online retailers. These cart abandonment rates are significantly lower for Gen With Gen Z’s spending power expected to reach $12 trillion by 2030, retailers risk missing out on a major demographic if they fail to expand online payment options.

Digital wallets like Apple Pay and Google Pay are becoming more common for online and in-store purchases. Digital wallets were used in 40% of online purchases in 2025 and 17% of in-store spending, according to research from payment technology company Global Payments.

Meanwhile, the PYMNTS study found that 87 million consumers, or a third of U.S. shoppers, had used an online digital wallet in the previous 30 days. Despite Gen Z’s well-documented propensity toward analog living, this demographic remains the most likely to use digital wallets, at 47%, followed by millennials at 44%.

These digital natives are driving a global shift to digital wallets, particularly in the United States, where $4.1 trillion in total spending is expected to be made via digital wallet by 2030, a 64% increase from 2025. As Gen Z increasingly uses their digital wallets, businesses that don’t adapt risk being left behind, as the group’s behavior is a sign harbinger of future consumer trends.

Unsurprisingly, financial insecurity has major effects on how people spend: The PYMNTS study found that when their preferred method was lacking, 29% of consumers living paycheck to paycheck and struggling to pay their bills abandoned their cart. The rate is nearly three times higher than that of consumers who don’t live paycheck to paycheck, or 11 percent.

This problem is particularly pronounced for Generation Z, whose current unemployment rate is 8.3%, double the national average. Even young people who are employed struggle with the cost of living in the United States, with 42% of Gen Z living paycheck to paycheck.

As many young people face financial pressures, the preference for Buy Now, Pay Later (BNPL) services supported by online wallets is increasing. These short-term financing options allow users to make a down payment and then split the remaining balance into multiple subsequent payments.

The PYMNTS study found that 17.7 million customers abandoned a purchase in the past 30 days because PayPal was unavailable, and 11.1 million of them cited the lack of PayPal Pay Later as a specific reason for the purchase failure. PayPal Pay Later was more popular than other major BNPL services, with 20% of consumers preferring the service over Klarna (12.4%).

Ultimately, running out of digital wallet options means losing out on profits: 33% of digital wallet users said they would have delayed a purchase, changed merchants, or skipped it if their wallet hadn’t been accepted, according to the PYMNTS study. This figure is much higher for Generation Z, with almost half of the age group saying they would have changed merchants or abandoned the transaction.

Overall, 21% of U.S. consumers had abandoned an online purchase in the 30 days preceding the PYMNTS survey, and 47% of them were interested in using a digital wallet. This represents 26.3 million lost customers, notes the study.

“Payment is the final transfer of a baton, and a missing payment option can drop the baton just short of completion,” the PYMNTS study says. “Any unsupported payment method is a potential lost sale, and the younger your customer base, the higher the risk.”