Peer-to-peer payments, a hybrid beast combining elements of e-commerce, personal banking, and social media, are big and getting bigger, according to a new survey by Bank of America, which found rising rates of adoption for P2P platforms like Venmo and Zelle across the population – but no surprise, millennials are leading the way.
Overall, the BoA survey found that 36% of U.S. adults are currently using P2P payment services, including 62% of millennials, while 45% of non-users said they plan to start using P2P payments soon.
Asked what their main motivations for embracing P2P are, 68% of current users cited convenience and time savings, while 48% said they use it because their friends do; just 16% said they didn’t want to use money or checks any more.
Turning to spending categories, 45% use P2P platforms to pay bills including utilities and rent, followed by shared payments for gifts at 42%, travel at 37%, and dining at 35%.
According a separate forecast from another source, peer-to-peer payments will grow from $59.42 billion in 2016 to $92.1 billion in in 2017.
Interestingly, BoA found that the ease of payment makes it socially acceptable to ask for repayment of smaller amounts: 51% believe its fine to ask for repayment of an amount less than $5, and 36% of respondents said no amount is too low.
On the other end of the scale, 44% said they would be comfortable sending $1,000 or more over P2P platforms, and 26% said they would send any amount.
The rise of P2P is bringing with it some major social transformations: 71% of respondents said they think children under the age of ten will never use checks, and 42% believe they’ll never use credit cards.
P2P payments may be big in the U.S., but they are positively enormous in China.
A recent survey by the United Nations found that digital payments via social media P2P systems across all categories reached an astonishing $2.9 trillion in 2016 – a twentyfold increase compared to just four years before.
The lion’s share of these payments were handled by two dominant services, Alibaba’s Alipay and WeChat Pay. In addition to enabling digital payments between individuals as well as a range of businesses and government organizations, the UN noted that Alibaba’s tools allows users to invest their money in various financial products and build-up long-term savings.