Digital Wallet Use Still Lags in the Physical Store

Online shopping has stopped being a young person’s game, and the data now points to a broader shift: where consumers shop is increasingly tied to how they pay.

PYMNTS Intelligence’s “How People Pay: Payment Choice Depends on Shopping Channel” finds that eCommerce use looks surprisingly similar across age groups in core categories such as retail and travel, even as payment method preferences diverge sharply between online and in-store purchases.

A key implication sits beyond the familiar debit-versus-credit split.

The report suggests the center of gravity in commerce is moving toward a channel-first mindset. Consumers appear to be settling into stable online routines for certain purchases, while treating other categories as more flexible.

These findings matter for banks, card issuers and merchants because the “last mile” of commerce is not only about what customers can use to pay, but also where they choose to transact in the first place. The channel sets expectations around safety, convenience and control.

It also shapes which brands win the basket. This is not a temporary spike. It is a durable pattern.

Consumers were twice as likely to use a digital wallet online for retail purchases, with 16% using a wallet online versus 8% in stores.

Merchant choice concentrated heavily online: 53% of consumers who used credit cards for their latest online retail transaction bought through Amazon, as did 44% of those who used debit cards.

The report also shows that the generational “digital divide” is narrowing in the places many observers once assumed it would remain wide. For the last retail purchase, 27% of baby boomers and seniors bought online, compared with 25% of Gen X, 26% of millennials and 23% of Gen Z.

That sameness is most visible in retail and travel, categories where convenience and selection can outweigh the appeal of an in-person visit.

Yet the convergence does not hold everywhere. Younger consumers remain more inclined to place food-related orders online, with Gen Z consumers 72% more likely to have made their last restaurant purchase online than baby boomers and seniors.

The report’s merchant findings add another layer: outside Amazon, payment type aligns with retailer choice in ways that hint at underlying priorities. Online debit shoppers were more than four times as likely to make their last purchase at Walmart, at 17%, versus 4% for online credit users.

In stores, Walmart led for both groups, while discount retailers such as dollar stores drew 7% of in-store debit shoppers, compared with Target’s 6% share among in-store credit users. Taken together, the report frames eCommerce less as a story about age and more as a story about channel, trust cues and value seeking.