What’s in our wallets?
Americans in our Future of Money Study predict apps will jump to top of wallet for in-person payments and PayPal will jump to top of wallet for online payments, while Americans also anticipate options that haven’t been invented yet. We see tangible evidence of technology impacting payment behaviors, and Americans are changing where they store their money—for every day spending and for saving and investing.
Over half (58%) of Americans in our Future of Money study report being current users of PayPal. According to an article in PaymentsJournal, PayPal accounts for 14% of online payments made in the U.S. PayPal now reports 237M active accounts, and an average of 34.7 payments per account totaling $2.2B in transactions in Q1’18. The balances Americans keep on their PayPal accounts may surprise you. Americans keep more than twice as much cash on hand in their PayPal accounts as in their wallets. Americans with PayPal accounts in our study report having an average of $485 in their PayPal accounts.
When asked if they were given an extra $500, 18% of Americans and 27% of Millennials would put it in their PayPal account..
Traditional and transactional needs drive online accounts
Why are Americans storing money in their PayPal accounts? Most who keep money in their PayPal accounts do so to maintain a balance for transactional purposes. Fifty-five percent like to keep money in the account for other payments, 25% find it easier to track expenses, 21% haven’t gotten around to moving the funds, and 19% prefer it to a bank account.
Almost one in five (19%) prefer PayPal to a bank account. The other reasons Americans have for keeping money in their PayPal accounts suggest that they use this account for regular spending operations.
The percentage of Americans who report storing money in their PayPal accounts and the amount of money they hold on balance there is worth paying attention to. There’s an opportunity for financial services companies to help Americans use this platform to better manage everyday expenses and plan for the future.
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