Decoding Gen Z's Impact on Payment Technology: Insights from University Campuses

New payment trends are continuously emerging, reshaping the way we interact with financial services and technologies in our daily routines. But there is a way to quickly assess where these payment trends might be going next: head to college campuses. These hubs of innovation offer a unique glimpse into the future of payments, providing insights into potential early adoption trends and a great way to glean knowledge from a generation that's set to redefine financial technology.   

University campuses serve as vibrant showcases of Gen Z's financial behaviors and preferences, reflecting a blend of their monetary habits, consumer expectations, and the challenges they face. Campus payments providers must navigate the convergence of advanced technology and evolving financial literacy and management practices tailored to the unique needs of young adults. In the lives of today's students, mobile payment apps, peer-to-peer (P2P) platforms, and digital wallets are becoming staples. This tech-savvy generation's ease with digital solutions, coupled with their consumer expectations, drives the payment industry towards more user-friendly and seamlessly integrated payment solutions. 

Gen Z students benefit from fintech solutions that help them manage their money. Institutions that prioritize financial literacy programs and integrate financial wellness into campus life may be more likely to attract and retain Gen Z students, as research shows they are stressed about their finances and are trying to establish good money management habits now. Gen Z is also very attuned to payment choice – solutions that offer them ways to manage their money will help Gen Z improve their financial health and set themselves up for success after college.  

There is an expectation that college campuses will adopt modern technologies, including payment innovations, reflecting the preferences of a never-ending crop of digitally focused young adult consumers. With today’s multifunctional student IDs, millions of Gen Zs have become accustomed to opening the doors to their on-campus housing, paying a friend for lunch, tapping for a snack from the campus bookstore and paying their tuition with one-click, all on one device. In fact, 55% of current college students think colleges that don’t offer digital ID with integrated payments are “stuck in the past,” according to the “Exploring Financial Habits and Technology Use Among College Students” study by Transact in partnership with The Center for Generational Kinetics (CGK). This study provides valuable insights into trending payment behaviors and preferences of this generation. So, how does Gen Z want to pay? 

When it Comes to Payments, Make it Mobile: The same study referenced above shows that 68% of college students believe that a mobile-centric payment solution would reduce stressful purchase interactions on campus and enhance their ability to manage finances. Their desire for digital IDs and payments experiences, particularly mobile options, directly impact student experience ratings and can even influence their choice of college. Gen Z students expect their colleges to provide a tech-friendly environment where every aspect of campus life, including dining and amenities, is easily accessible through digital means with a simple tap or scan.  

Students Demand Fast, Easy Ways to Pay: As digital natives, Gen Z students stand at the forefront of advocating for swift and straightforward payment methods. Accustomed to the immediacy of digital transactions, they seek a cohesive and efficient financial experience in their educational settings. American college students voice concerns about outdated payment processes for academic expenses and show a strong preference for more streamlined, mobile-adapted payment systems. Convenience in payments is considered crucial, with 72% of students suggesting that the ease of payments should be factored into college ratings1 focused on student experience. Likewise, 72% of students1 emphasize the significance of modern technology when selecting an academic institution, suggesting that tech-forward campuses attract more students. The move towards a smoother payment journey is more than a matter of convenience—it's seen as a catalyst for greater satisfaction and better financial practices among students. An impressive 71% of college students1 even say they would be more likely to pay their tuition at a quicker rate if their college had a better payment experience. This sentiment underscores the evolving expectations that Gen Z has for the institutions they attend, not just for education but for an all-encompassing digital lifestyle. 

Integration is the Expectation: Integrated digital experiences for campus life, including dining and amenities, are essential, shaping expectations beyond graduation. Technologies like Amazon’s Just Walk Out technology are growing rapidly on college campuses with students seeking out commerce locations that offer such conveniences. As students hit the “real world” after graduation, their expectations for embedded technology in retail, apartment security, work-campus IDs, and payment tools are heavily shaped by their campus experience.    

Understanding these trends is critical to anticipating the needs and opportunities that will define the future of payments. Gen Z, driven by a blend of digital fluency and high expectations, is not just using technology—they are reinventing it. The path to understanding the next wave of payment technologies runs through the heart of colleges and universities. As you evaluate whether your payments tech is Gen Z-approved or need to test new concepts with a discerning audience with the future in their hands, consider heading to a college campus. 

1“Exploring Financial Habits and Technology Use Among College Students,” 2023. Study by Transact in partnership with The Center for Generational Kinetics (CGK)