A new report has identified a new trend of Generation Alpha leading the push for digital payments, with the cohort leading adoption metrics over other demographics.
The study, carried out by Mastercard (NASDAQ: MA), reveals that one in two Gen Alpha have a digital wallet, while nearly 50% of respondents have access to an investment account. Gen Alpha are individuals born after 2010, characterized by tech-savviness, given their access to smartphones and tablets from childhood.
The Mastercard study honed in on the Asia-Pacific region, highlighting key payment trends in the emerging demographic. Mastercard based the report on the submission of 9,131 Gen Alpha respondents and their parents.
The study revealed that despite the high prevalence of digital wallets, 48% of Gen Alphas still rely on credit cards. A staggering 47% of respondents say their kids (Gen Alphas) introduced them to new digital financial tools.
The report highlights key differences between Gen Alphas and Millennials in terms of digital finances. Among Gen Alphas, there is a preference for innovative financial tools leveraging artificial intelligence (AI) and blockchain technology.
Gen Alphas are more likely to adopt tokenized assets and gamified finance over other demographics, showing a preference for voice interface and decentralized finance (DeFi). Sandeep Malhotra, Mastercard VP for core payments in APAC, disclosed that cash adoption in the cohort is the lowest across the spectrum while digitization is at its highest ebb.
“They’re low-key money bosses, tapping phones before they can tie their shoes and turning budgeting apps into their playground,” said Malhotra. “Cash? Not their go-to. Today it’s all Tap & Go.”
Gen Alphas indicate a preference for superapps, financial applications that go beyond payments, offering in-app social and shopping functionalities. Indonesia and China are leading the push for super apps in the region, with local data indicating a surge in Gen Alpha users.
APAC is setting the global pace for digitization
Regarding emerging technology adoption, the Asia Pacific region is moving ahead of its peers. Digital wallet adoption has increased throughout Asia while cash usage has reached new lows, outperforming the metrics of North America and Europe.
In terms of AI, the APAC workplaces are the biggest adopters of AI-powered workflows, integrating them into their internal operations. APAC is miles ahead of the global average of 62.3% for digital workplace maturity, but job loss concerns and steep implementation costs continue to hinder progress.
Benin Republic to national digital ID system with mobile wallet functionalities
In other news, authorities in the Benin Republic have flashed the signal to roll out a national digital ID system for the country, merging emerging technologies into the offerings to improve existing solutions.
According to a report, the West African country will integrate digital wallet functionalities into its digital ID system in a massive innovative leap. Aristide Guy Adjinacou, Director General of the National Agency for the Identification of Persons (ANIP), revealed the plans during the ID4Africa conference.
Adjinacou disclosed to conference attendees that Benin has all the components needed to proceed with a national digital ID system. However, the last piece of the puzzle of the West African country is a mobile digital wallet for citizens to store credentials and personal data.
The DG hinted that the offering would rely on blockchain, but it remains unclear if the digital wallet would offer payment functionalities. In terms of timeline, Adjinacou disclosed that the agency is eyeing a rollout by the end of 2026, prioritizing the digital ID system for citizens.
Adjinacou disclosed that the integration into the national digital ID system will promote inclusivity while ensuring the security and privacy of personal data. Adjinacou stated in his keynote address that the country’s digital transformation stems from a forward-thinking approach of the ruling government.
The push toward digitization has the backing of local legislation, with the DG pointing to the 2017 Identification Law. Per Adjinacou, swift enforcement has seen 10 million individuals registered across Benin in the last six months, providing a deep database for the push towards a national digital ID system.
“Our register is connected to more than 80 public and private institutions, including banks and telecom operators,” said Adjinacou. “ This success is no accident, it is the result of deliberate strategy and strong foundations.”
Integrating AI into local ID services
Amid the push, Adjinacou disclosed a series of forward-thinking statements pointing to integrating artificial intelligence into the digital ID system. AI integration will be limited to information gathering to enable authorities to make data-driven decisions, particularly in reaching individuals in remote locations.
“Reaching the remaining two percent of the population is one of the most difficult tasks,” said Adjinacou. “These last-mile communities each have unique characteristics and needs, and we must tailor our approach accordingly.”
Across Africa, digital ID initiatives are gathering steam, with Nigeria and Zambia unfurling their national offerings. Ethiopia, Namibia, and São Tomé and Príncipe are the latest to signal an incoming national digital ID initiative.
Watch: Importance of digitalization for enterprises
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Source: https://coingeek.com/gen-alpha-leading-the-push-for-digital-payments-report/