According to a new survey conducted by Cardbeat and Auriemma Consulting Group (ACG), more than three-quarters (76%) of American consumers have an active PayPal account. This percentage rose up sharply from 55% in their 2008 survey.
Still, PayPal accounts for less than 10% of total online sales volume in 2010. The seemingly inexorable growth of online e-commerce websites and trade drives more and more dollars to the payment service. Final volume counts still await the end of the holiday shopping season. PayPal reported a 27% increase over 2009 in Black Friday online payments.
“PayPal has long been popular with young consumers,” noted Patricia Sahm, Managing Director at ACG, “but it’s striking to find that 69% of respondents 45 and older said they have an active account. Many of our respondents say they feel more comfortable using PayPal rather than their credit cards for online shopping.”
The Cardbeat survey also found significant gains in frequency of Pay Pal usage. The numbers were rising from an average of 10.8 purchases a year in 2008 to 14.0 annual purchases in the most recent study.
And those millions of PayPal accounts are increasingly bypassing the credit card networks altogether. “We”re seeing substantial gains in consumer willingness to provide their bank account information to Pay Pal,” Sahm said.
Resistance to using PayPal is dwindling
In 2008 45% of survey respondents said that they were “uncomfortable””with the idea of providing bank account information to an internet-based payment company like Pay Pal. In the most recent 2010 study that percentage had fallen to 31%.
“Visa and MasterCard formerly had a complementary relationship with Pay Pal when consumers used their credit cards to fund their Pay Pal account. Still, the credit card networks are cut out of the exchange when Pay Pal is positioned like a debit card linked directly to the checking account.”
Cardbeat is ACG‘s syndicated market research study of credit card holders, conducted monthly in the U.S. and quarterly in the U.K.