Nearly Half of Digital Bank Customers Prefer Digital Wallets
•February 18, 2026
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Why It Matters
The data signals a near‑term opportunity for banks and merchants to capture spend through pay‑by‑bank solutions, provided they bundle tangible rewards and robust consumer safeguards.
Key Takeaways
- •44.6% digital bank users favor digital wallets.
- •35.4% would switch to pay‑by‑bank with rewards.
- •Users skew younger, lower income, less college‑educated.
- •Immediate cash incentives drive adoption for 43% users.
- •Pay‑by‑bank viewed as debit alternative by 72%.
Pulse Analysis
Digital wallets have moved from a niche convenience to a mainstream payment channel, especially among customers of challenger banks. These users are already accustomed to login‑based checkout flows, which reduces friction compared with traditional card entry. Their propensity to adopt new payment methods is amplified by mobile‑first habits and a desire for instant savings, making wallets a natural gateway for broader account‑to‑account (A2A) transactions.
Pay‑by‑bank, often positioned as a debit alternative, still requires a compelling value proposition to break entrenched card usage. The PYMNTS study shows that 72% of respondents would consider it a viable substitute if paired with discounts or buyer protection, yet only about 12% see it as a direct replacement without incentives. Immediate cash‑back offers emerge as the strongest catalyst, resonating with the financially constrained profile of digital‑bank customers—over half earn less than $50,000 and many lack a college degree. By bundling clear fraud safeguards with tangible rewards, providers can convert the 35.4% of users who are ready to shift spend.
For merchants and fintech platforms, the strategic playbook is clear: target high‑frequency, low‑value categories such as bill pay, rideshare, and gambling where digital wallets already dominate. Integrate pay‑by‑bank options at the point of sale, overlay real‑time discounts, and communicate protection guarantees transparently. This approach not only taps into a sizable, price‑sensitive cohort but also builds a foundation for long‑term loyalty as digital banks vie for primary relationships. Early adopters who align incentives with security will likely capture a disproportionate share of the emerging A2A market.
Nearly Half of Digital Bank Customers Prefer Digital Wallets
Pay by bank is starting to look less like a niche payment option and more like a switch consumers will make when merchants pair it with real value and clear protections.
The PYMNTS Intelligence report “Pay by Bank Deep Dive: Digital Bank Users Are Ready to Switch” examined how willing consumers in the United States are to move everyday spending to direct-from-bank payments and what it will take to get them there. The report was based on a survey of 2,071 adult bank customers conducted in June.
The central theme was not that digital bank users behave like a separate species, but that they are already trained for login-based payment flows through the use of digital wallets, while still demanding immediate savings and strong buyer protection.
That combination matters as digital banks continue to compete for primary relationships.
Key findings from the report:
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13.8% of bank customers say a digital bank is their primary financial institution.
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44.6% of digital bank customers prefer paying with digital wallets, above other bank groups in the survey.
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35.4% is the estimated share of account-to-account transactions that digital bank users would shift to pay by bank if it came with discounts and buyer protection.
Other findings added texture to what “ready to switch” actually means. Digital bank users skew younger and more financially constrained, as 52% earn less than $50,000 a year, and 86% do not have college degrees.
In daily spending, many already default to wallets in mobile-heavy categories, including rideshare (51.9%) and gambling (60.3%), a sign that habit can shift away from cards when the experience is familiar.
The report also suggested that pay by bank’s competitive target is debit, but consumers need a reason to treat it that way. Although 72% said they already view pay by bank as a debit alternative or would do so under the right incentives, only about 12% currently see it as a substitute without added rewards or protections.
Incentives are also consistent across bank types. Among digital bank users, 43% rank immediate cash benefits as the top driver, while 24% of respondents overall said nothing would make them more interested, with digital bank users slightly higher at 25%.
Taken together, the data pointed to a practical playbook. Start where switching potential is highest, such as bill pay and A2A transfers, and pair the offer with protections people can understand.
Incentives matter. Protection matters. Simplicity matters.
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At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.
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