Report reveals 63% of Gen Z have moved away from credit cards in favor of alternatives as hidden fees, high interest rates and financial stress drive demand for more transparent alternatives

More than half of Gen Z believe BNPL helps them better manage their finances compared to traditional credit, highlighting a clear generational shift

Today, Cash App Afterpay released the Why Credit Cards Give Gen Z The Ick Report, a deep dive into the evolving financial behaviors of next generation consumers based on research conducted by Morning Consult. The report highlights growing skepticism with traditional credit, the struggle to budget effectively, and a rising preference for debit cards and Buy Now, Pay Later (BNPL) solutions - trends that are magnified with Gen Z consumers.¹ This comes at a critical time for retailers and brands with Gen Z poised to drive major structural shifts in the economy. With their growing purchasing power, digital fluency, and values-driven behavior, they will shape industries, influence trends and redefine how brands engage with them.

The Growing ‘Ick’ Factor of Credit Cards for Younger Consumers

Consumer sentiment around credit cards is shifting for all Americans, with 82% agreeing that using credit cards can be financially dangerous. For many, credit card debt isn’t just a financial burden, it’s an emotional battle, with 68% of Americans saying they struggled with credit card debt at some point. More than two-thirds of Gen Z (68%) report that credit card bills cause them stress and anxiety, while more than half (51%) say credit cards give them the ‘ick.’

Research found that 40% of credit card users are frequently surprised by how much they pay in interest fees, a figure that jumps to 53% for Gen Z. Similarly, just 72% of Gen Z feel confident in managing their personal finances, which is significantly less than Millennials (82%), Gen X (85%), and Boomers+ (92%). It’s clear a gap exists in financial transparency and education for younger generations - underscoring the need for a new solution.

Americans, Especially Gen Z, Are Choosing Debit and BNPL Over Credit Cards

As frustration with credit cards grows, consumers are actively seeking alternative payment methods that offer greater transparency and control. Debit cards remain the most widely used, with 70% of Americans relying on them for purchases. According to the report, 60% of Americans who have used a credit card have switched to another payment method, and that’s even higher for Gen Z at 63%.

Notably, more than half of Gen Z (52%) believe BNPL could help them better manage their finances compared to traditional credit, highlighting a shift toward structured, interest-free payment models that prioritize financial well-being. BNPL solutions, such as Cash App Afterpay, are an increasingly trusted option especially among younger consumers. The report finds that nearly half of Americans (48%) are open to using BNPL in the future, including 55% of Gen Z.

The Future of Payments: Choice, Control, and Clarity

These findings reinforce the broader shift that consumers, especially Gen Z, are making toward financial tools that prioritize transparency, flexibility, and responsible spending—values that are shaping the future of payments.

Consumers are reevaluating their relationship with traditional credit, and are no longer willing to accept opaque fees or compounding interest, nor the stress that accompanies it. Instead, they are gravitating toward payment solutions that value transparency and flexibility, and most importantly one that supports their financial health.

Cash App Afterpay is at the forefront of this shift, offering a transparent and responsible way to shop and budget without the stress of revolving debt. With features like real-time underwriting, clear payment schedules, and no compounding interest, Cash App Afterpay’s pay over time features are helping consumers spend smarter and plan better, empowering them to take charge of their financial future.

To access the full report, click here.

About Afterpay

Cash App Afterpay is transforming the way we pay by allowing eligible shoppers to buy products immediately and pay over time - enabling simple, transparent and responsible spending. We are on a mission to power an economy in which everyone wins. Afterpay is offered by thousands of the world’s favorite retailers and used by millions of active global customers. Afterpay is currently available in Australia, Canada, New Zealand, the United States and the United Kingdom, where it is known as Clearpay. Afterpay is a wholly owned subsidiary of Block, Inc. (NYSE: XYZ).

¹ Drawn from insights from a survey of more than 5,400 adults in the U.S.

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