Shoppers are ditching physical cards for digital wallets at unprecedented rates, with younger generations leading the charge.
Artificial intelligence is now actively purchasing goods for consumers through new agentic commerce tools. Digital currencies, including cryptocurrency and stablecoins, are moving into the mainstream as preferred payment and gifting options, especially for cross-border transfers.
The global payments landscape is undergoing a fundamental transformation this holiday season, driven by generational shifts and technological innovation. According to new data from Visa, one in five U.S. shoppers now prefers using a digital wallet, with Gen Z being the primary catalyst.
This demographic is just as likely to pay with a digital wallet (36 percent) as with a traditional physical card (34 percent), signaling a pivotal change in payment behavior. This shift is even more pronounced in markets like Singapore and the UAE, where digital wallets are now trusted more than cards or cash for their security, speed, and convenience.
Concurrently, artificial intelligence is moving beyond browsing recommendations to become an active shopping participant. Major financial and tech firms are deploying AI shopping agents, a trend that aligns with growing consumer experimentation. Visa’s research indicates that nearly half of U.S. shoppers are already using AI to assist with purchases. This follows announcements from industry leaders like Mastercard, which is testing an “Agent Pay” feature, and Amazon, which piloted a “Buy For Me” service. Partnerships, such as the one between PayPal and Perplexity on agentic tools, further cement this trend, allowing AI to autonomously execute transactions on behalf of consumers.
In the realm of currency, digital assets are stepping into the holiday spotlight. Cryptocurrency has emerged as a desirable gift, with 45 percent of U.S. Gen Z consumers expressing excitement to receive it, nearly double the national average.
For practical payments, stablecoins are gaining significant traction for international remittances, with 41 percent of U.S. remittance users likely to adopt them. Global readiness varies sharply, however, with high intent in Brazil, Mexico, South Africa, and the UAE contrasting with more cautious attitudes in Germany, underscoring a diverse path to adoption worldwide.
Despite the rapid digital adoption, security remains the paramount concern for 79 percent of global consumers, influencing their payment choices more than any other factor. A significant 82 percent of U.S. shoppers have proactively increased their security measures this season, such as using two-factor authentication, amid fears of sophisticated fraud.
This concern is felt unevenly across the globe, with surveyed regions in CEMEA and Latin America reporting the highest exposure to online payment scams, while Europe reports the lowest. Even in cash-stronghold markets like Germany, consumers anticipate a steady decline in cash usage over the next decade, confirming the irreversible momentum toward digital, secure payment methods.
Source: AI and digital wallets reshape spending habits. (n.d.). Visa.
