Most Popular Online Payment Methods

Last updated: December 14, 2023

Highlight. Digital wallets pay for 49% of global online purchases; projections indicate that will increase to 54% by 2026.

  • U.S. consumers use digital wallets for 32% of online transactions; projections indicate that by 2026, that share will increase to 41%.
  • PayPal is the most popular digital wallet among U.S. adults with a 71% penetration rate.
  • Global consumers pay for 20% of online purchases with credit cards; projections indicate that value will decline to 16% by 2026.
  • Americans use credit cards for 30% of online purchases; projections indicate a 23% decline by 2026.
  • Global consumers use debit cards for 12% of online sales and direct transfer for 9% of sales.

Grouped Bar Graph: Most Popular Online Payment Methods as a share of global transaction value from 2019 to 2022 according to FIS Global

Digital wallet is currently the most popular online payment method in the U.S. and worldwide.

  • Globally, consumers are 145% more likely to use a digital wallet than any other form of online payment.
  • According to projections, digital wallet use will increase 10.2% from 2022 to 2026.
  • Digital wallet use increased 17.2% from 2019 to 2022.
  • Credit card payments for worldwide online sales declined 4.76% from 2021 to 2022.
  • North American consumers used credit cards for 31% of online purchases in 2021 and 2022.
  • Global use of debit cards for online sales declined 7.69% from year-over-year (YoY).
  • North American consumers used debit cards for 19% of 2022 online purchases down 9.52% year-over-year (YoY).

Bar Graph: U.S. Adults Using Digital Wallets according to Morning Consult

Digital wallets first overtook credit cards as the most popular online payment method in 2022.

  • 185 million American adults use PayPal; among them, 22% use the app daily.
  • 114 million or 44% of American adults use Cash App.
  • 65% of American adults use digital wallets on a monthly basis at least (or more often).
  • At least 33% of digital wallet users make daily use of their digital wallet.
  • Global online consumers spent an estimated $2.77 trillion using digital wallets in 2022.
  • In the U.S., digital wallet payments for online purchases totaled an estimated $540 billion.
  • U.S. PayPal users are the most likely to use other digital payment methods, such as Venmo (89% of PayPal users) or Apple Pay (88% of PayPal users).
  • Apple Pay users are the least likely to use more than one digital payment app, such as PayPal (34% of Apple Pay users) or Venmo (49% of Apple Pay users).
  • U.S. consumers are 3.23% more likely to use digital wallets than any other method of online payment.
  • Online digital wallet use in North America increased 60% from 2018 to 2022.
  • According to projections, digital wallet use in North America will increase 28.1% from 2022 to 2026.
  • 22% of digital wallet users usually fund their digital wallet purchases with a credit card.
  • In the U.S. 31% of users fund their digital wallets using a credit card; 33% use a debit card and 20% use a bank account.

Doughnut Graph: Global Online Payment Methods totaling $5.83 trillion in total payments according to FIS Global

Credit cards were the most popular online payment method in the U.S. until 2022; other popular methods include debit, Buy Now Pay Later (BNPL), Cash on Delivery (CoD), cryptocurrency, etc.

  • Global use of BNPL increased 67% YoY while North American use increased 25%.
  • 94.3% of online merchants accept Visa and Mastercard.
  • 73.9% of online merchants accept PayPal.
  • 67% of online merchants worldwide cite debit cards as the most-used payment method for fraudulent orders.
  • 19% of purchases and person-to-person (P2P) payments in 2022 were online, up 5.56% YoY.
  • 29% of P2P payments in 2021 were via digital wallet or mobile app, up 164% from 2019.

Doughnut Chart: U.S. Online Payment Methods totaling $1.69 trilloin in total payments according to FIS Global

Global Online Payment Methods

Digital wallet payments are most popular in the Asia-Pacific region with 69% of online transactions using this payment method; a 41% higher rate than the global average.

  • 81% of online payments in China are made using digital wallets, the highest rate of any country. 
  • With only 9% of online payments completed via digital wallet, consumers in the Netherlands and Turkey are the least likely to use this payment method globally.
  • Credit card payments are most popular in Latin America with 35% of online transactions completed using this method. 
  • In Japan, 57% of online payments use credit cards, the highest rate of any country. 
  • Only 4% of online payments in China are completed via credit card, the lowest rate globally. 
  • Consumers in Belgium are the most likely to use debit cards at 30% of online transactions completed using this payment method. 
  • Direct transfer is the most popular in Poland and the Netherlands, accounting for 67% and 62% of online payments respectively. 
  • Buy Now, Pay Later is most popular in Sweden with 24% of online transactions completed using this payment method. 
  • Cash on delivery for online purchases is most prevalent in Vietnam with 18% of transactions using this method. 
  • PrePay is most popular in Saudi Arabia where 4% of online transactions use this payment method.
  • PostPay is used most frequently in Peru, accounting for 9% of online transactions. 
  • In Italy, 9% of online transactions are made using prepaid cards, the most of any country. 

100% Stacked Column Cahrt: Online Payment Volume by Region according to FIS Global

These data and insights were compiled by the Capital One Shopping team based on publicly available data.

Sources

  1. FIS Global, Global Payments Report
  2. Statista, Credit Cards Worldwide – Statistics and Facts
  3. Morning Consult, The State of Consumer Banking & Payments
  4. United States Census Bureau
  5. Federal Reserve Bank of San Francisco, Publications