PayPal has seen an increase in the number of over 50s using its services between March and April this year, the first time this age group has been the firm’s fastest growing segment.
The increase comes as the COVID-19 pandemic is encouraging consumers to avoid potentially virus-spreading cash payments in favour of digital alternatives.
Speaking at a J.P. Morgan online conference last week, PayPal CFO, John Rainey referred to the growing segment as ‘silver tech’ and explained how growth in over 50s has helped the firm return to ‘pre-COVID’ levels of business.
It is unclear whether the increase in customers over 50 has affected numbers for just PayPal, or whether its digital wallet brand, Venmo has also benefited. Regardless, an increase in the over-50 market will be seen as a significant win for the Venmo brand which has, so far, struggled to grow in this segment.
Speaking at last week’s event, Rainey said, “We think that these are some sustainable trends in our business”.
Analysis – the start of an ongoing trend
Whilst it may be a cliché, the truth is that technology in the payments and finance industry has been adopted more quickly by younger segments of the market.
Venmo is the perfect example. It’s a service that boasts 52m active users however it has struggled to attract older users.
According to a recent survey carried out in the US by AARP about a third of younger people (under 50) said they use Venmo, compared with just 9% of people over 50.
The COVID-19 pandemic has put a strain on the economies of the world, but it has also incentivised the uptake of e-commerce and digital solutions for firms who were perhaps behind the curve. The lockdowns and increasing number of digital alternatives seems to have reached the over-50 segment.
With UK ONS data suggesting that in 50 years’ time there will be an additional 8.2m people aged 65 years and over, PayPal and other fintech firms can expect this segment to become an increasing area of focus.