A P2P Payments Adoption Upswell Is Looming in 2017, According to a BofA Survey

Consumers of all ages appear to be embracing person-to-person payments, finds the Bank of America Trends in Consumer Mobility Report released Thursday.

The report, which surveyed more than 1,000 U.S. adults who have a banking account and a smart phone, found that 36% of all respondents use a P2P payments service. By generations, 62% of younger consumers—those between 18 and 34 years old—used a P2P payments service, compared with 34% of those between 35 and 52 years old, 20% of those 53 to 71, and only 10% of those 72 or more.

These usage rates, however, are expected to increase. Of those not currently using a service, 47% of the youngest generation anticipate doing so by the end of 2017, while 48% and 49% of the next two respective generations will. Fully 25% more of the oldest generation plan to begin using a service.

The survey also asked about comfort levels concerning amounts sent or received. Apparently, there is no high or low end in most consumers’ minds. When asked what would be the lowest amount of money they would request through a P2P payments service, 36% said no amount was too low, followed by 22% at $10 to $20; 16%, $25 to $50; 15%, $5; and 11%, more than $50.

Asked the highest amount they would be comfortable sending, 26% said no amount was too much. But 29% would only be okay with $100 to $200. Twenty percent said no more than $500, while 18% said sending $1,000 to $3,000 was acceptable. Only 5% said $50 or less.

Charlotte, N.C.-based Bank of America Corp. is one of the banks that own Zelle, a P2P service that is owned by several big banks and is rolling out nationwide this year. BofA already has some aspects of Zelle in its P2P service.

BofA also asked why consumers use P2P payments services. Forty-five percent said it was to pay bills and 42% said for gifting. Other top uses were travel, 37%; dining, 35%; family functions, 31%; transportation, 30%, concerts and shows, 26%; and date expenses, 14%.

Banks have significant interest in persuading consumers to use their P2P payments services versus the likes of Square Inc.’s Square Cash or Venmo from PayPal Holdings Inc. But banks must make the service more widely available within their digital offerings, Javelin Strategy & Research, a Pleasanton, Calif.-based advisory firm, stressed earlier this year.

BofA says it has more than 22 million active mobile users. During the first quarter of 2017, they made more than 29 million mobile bill payments and almost 9 million P2P transfers, a tally that is 76% greater than in 2016, the bank said.