Trends, Challenges, and Consumer Payment Insights for 2025

Decades used to go by without any changes to how we paid. You remember when carrying a wallet full of paper bills gave a sense of security and freedom, and credit cards were for emergencies only. That is certainly not our reality today. As we kick off 2025, we're breaking down the latest trends, tackling issues like payment fraud, exploring new ways to pay, and understanding how consumer behavior shapes how we handle transactions. Here are some highlights from our recent white paper, Payments in 2025: Insights on Trends, Fraud, Flexibility, and Consumer Behavior.

Key Findings

• Payments fraud and security concerns are up
• Digital payment options are favored, but customers still want choice
• Debit and credit cards continue to dominate
• Demand for real-time payments is high, but bank technology lags behind
• It’s time for billers to embrace digital wallets
• BNPL is influencing consumer behavior and their approach to bill payments
• Cryptocurrency continues to face challenges, but supportive regulation could alter its role in payments

Detailed Insights

Rising Payments Fraud and Security Challenges

A 2024 Association for Financial Professionals (AFP) report found that 80% of organizations were victims of payment fraud attacks or attempts in 2023. This is a 15% increase from the previous year, with checks being the primary target. Billers committed to protecting themselves and their customers should be incentivized to stop offering paper checks as a payment option for this reason alone, choosing instead to use secure payment methods like digital wallets with more security measures. 

Recommendations for Billers

• Educate consumers on safe practices and implement multi-factor authentication and encryption.
• Balance security with user experience, ensuring compliance without compromising the customer journey.

No One-Size-Fits-All Approach to Bill Payments

With so many different payment methods and channels available, why should customers use just one? The answer is that they shouldn’t and don’t want to. KUBRA research found that credit and debit cards were the most popular payment methods in 2024, followed by cash and direct bank accounts (ACH).¹ Looking specifically at digital payment channels, mobile apps, biller websites, and bank websites were the top choices.²

Recommendations for Billers

• Offer a wide variety of payment methods to enhance payment flexibility and satisfaction.
• Prioritize digital payment channels and support these channels with live chat, chatbots, and virtual assistants to meet customer expectations and improve the payment experience. 

Rising Credit Card Use Amid Declining Delinquencies

A Federal Reserve Bank of San Francisco study reported that in 2022, credit cards accounted for 31% of all payments, which was the highest since the survey began in 2016. These findings suggest that credit cards are becoming more commonly used than cash and other payment methods. By mid-2023, the number of credit card users increased to 167.2 million, and as the year wrapped up, the total number of accounts was over 542.6 million.³ 

Despite the highest credit card interest rates since the 1990s, delinquency risks are dropping along with the percentage of balances 30-plus days past due.⁴ If this trend continues, it could signal financial stability for more households, reduce default rates, and ease the credit burden.

Recommendations for Billers

• Offer seamless and user-friendly credit card payment options, including Amex, Mastercard, and Visa, to improve customer satisfaction and enhance the payment experience.
  

Bank Infrastructure Stalls Widespread Access to Real-Time Payments

KUBRA’s 2024 Emerging Payment Trends white paper reported a high understanding of the concept of real-time payments (RTP). Now that they understand them, 70% of consumers expect their payments to be processed the same day or instantly in real time. This desire for instant payment is also reflected in the nearly 80% of consumers who indicated that they are interested in having access to faster payments, and 60% would like an immediate view of both their account balances and any payments posted.⁵ Currently, the biggest obstacle to widespread adoption is U.S. bank technology. Right now, there is no consistency in the ability to send and receive payments. 

Recommendations for Billers

• Prepare to invest in real-time payment systems once they are available to align with consumer expectations for faster payments.
  

High Satisfaction Drives Digital Wallet Growth

In 2023, the global mobile wallet market reached US$8 billion, and it’s projected to surge to US$88.36 billion by 2033.⁶ While 59% of consumers use digital wallets regularly,⁷ that number drops slightly for bill payments to 34%.⁸ This shows a high comfort level with this payment method and that perhaps the lack of availability and promotion of digital wallets for bill payments may be impacting adoption. Satisfaction is not only high with digital wallets, but consumers tend to use more than one. 35% of customers indicate they use two to three digital wallets to make payments, and 5% use more than three digital wallets.⁹

Recommendations for Billers

• Offer a variety of digital wallet options, including Apple Pay, PayPal, Google Pay, and Venmo.
• Increase adoption and visibility into what options are available to customers.
• Run educational campaigns to explain the benefits and features of digital wallets to help curb uncertainty.

Trends and Challenges of Buy Now, Pay Later

Buy Now, Pay Later (BNPL) services have quickly become a popular alternative to credit cards and other traditional payment methods due to their convenient and flexible payment options. Services like PayPal, Affirm, Afterpay, and Klarna allow consumers to make purchases with delayed payments or spread costs over installments with minimal or no interest. A Statista report revealed that 41% of U.S. adults have used BNPL in the past year, and an additional 22% anticipate doing so. BNPL is also being adopted for bill payments, though the staggered payment schedules may present challenges such as missed payments or late fees. 

Recommendations for Billers

• If you consider offering it, communicate payment schedules and potential fees clearly to consumers to ensure the successful integration of BNPL into your payment offerings.

Cryptocurrency Still Faces Adoption Hurdles

The global cryptocurrency market is projected to grow in the coming years as its role in everyday commerce expands. This has been boosted by well-known companies like Tesla and PayPal, which have started accepting them. Yet, consumers are still hesitating to use cryptocurrencies for bill payments. More than 60% are either unwilling or unsure about using them for such purposes.¹⁰

Recommendations for Billers

• Be aware that favorable regulation could potentially boost adoption, before writing this payment method off completely.

For more information on the rapidly evolving payment landscape, read our white paper Payments in 2025: Insights on Trends, Fraud, Flexibility, and Consumer Behavior.

Sources:

1. KUBRA Emerging Payment Trends Research 2024.
2. KUBRA Utility Consumer Billing and Payments Report.
3. Average U.S. FICO Score at 718, FICO blog, 2023.
4. Things Are Quiet in Consumer Credit. Too Quiet., WSJ, November 2024.
5. Federal Reserve Market Readiness Brief: Today’s On-Demand Lifestyle Is Spurring Greater Demand for Faster Payments, 2021.
6.  Precedence Research (2024, February). Mobile Wallet Market Size, Share, and Trends 2024 to 2033. Accessed July 11, 2024 from https://www.precedenceresearch.com/mobile-wallet-market.
7. S&P Global Market Intelligence 451 Research (2024). [Unpublished raw data from global consumer survey]. Commissioned by Discover Global Network.
8. KUBRA Emerging Payment Trends Research 2024.
9. KUBRA Digital Wallets Guidebook 2022.
10. KUBRA Emerging Payment Trends Research 2024.