December 18, 2025
FellowNeko/Depositphotos.com
Are Digital Cash Payments a New Threat to Traditional Gift Giving?
A new survey from Wells Fargo finds younger generations are increasingly open to receiving and giving digital cash for holiday gifts.
Asked for their preference for receiving holiday gifts (more than one answer allowed), 45% of Gen Zers and 42% of millennials prefer to receive digital payments, as compared to Gen Xers (27%) and boomers (10%).
The top preference for receiving a holiday gift across all respondents was gift cards, cited by 56%; followed by physical gifts, 55%; money in cash or check form, 48%; with experiences such as travel and events, or money through digital payments, tied at 29%.
On the giving side, 32% of zoomers and 28% of millennials prefer to give a digital payment as a holiday gift, versus only 11% of Gen Xers and 7% of boomers.
Across all respondents, the top gifting preference was physical gifts, 65%; followed by gift cards, 54%; money through cash or check, 34%; experiences, 19%; and digital payments, 18%.
The findings come as younger generations have become comfortable with digital payments, supported by platforms such as Zelle, Venmo, PayPal, and Cash App. Wells Fargo owns a stake in Zelle.
The survey of 2,010 U.S. adults found 28% of have received a digital payment as a holiday gift, versus 68% receiving cash.
Can Digital Gifts Feel Impersonal, and Does Awkwardness Remain Among Shoppers?
Similar to perceptions around gifting cards or cash, 57% of overall survey respondents agreed that sending a digital gift “feels impersonal — like I didn’t put any effort into the gift.” About one-third (32%) want to give money digitally, but wonder if it’s socially acceptable. About half (49%) desired receiving digital cash, but “feel weird telling that to the gift giver.”
On the positive side, 65% appreciate receiving a digital cash gift because it “gives me the freedom to choose something I really want,” with 36% appreciating digital cash because they don’t like most of the physical gifts they receive during the holidays.
Digital payments also offer convenience to many, with 62% believing giving digital cash “takes the guesswork out of gift giving.” About two-thirds (65%) agree that gifting cash prevents worry over gift wrap, postage, and shipping; with 52% of those shipping a gift worrying the gift may arrive late, get lost, or be stolen.
Giving and receiving gift cards has become significantly more acceptable since their proliferation in the 1990s. NRF’s 2025 Holiday Survey showed gift cards again ranked among the top gift consumers would like to receive (50%), followed closely behind by clothing or accessories (46%).
A recent survey from the Associated Press-NORC Center for Public Affairs Research found about 60% of Americans say cash or gift cards are “very” acceptable as holiday presents, versus only 30% indicating the same for a secondhand gift — and only 22% for a re-gifted item.
BrainTrust
Bob Amster
Principal, Retail Technology Group
Scott Benedict
Founder & CEO, Benedict Enterprises LLC
Bhargav Trivedi
Recent Discussions
Discussion Questions
Is the trend toward gifting digital payments, coupled with cash and gift cards, much of a threat to traditional gift giving?
Are there more ways for retailers to tap into the choice and convenience offered by the alternatives to traditional wrapped presents?
Poll
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I don’t see the trend toward gifting digital payments, cash, and e-gift cards as an existential threat to traditional gift giving so much as a complementary evolution of how people express appreciation — especially among younger generations. According to the Wells Fargo data that sparked the original conversation, while physical gifts still dominate for most people, a growing share of Gen Z and Millennials are comfortable giving digital payments or e-cash as gifts, driven largely by convenience, immediacy, and the freedom it gives recipients to choose what they want. This doesn’t mean traditional gifts are obsolete, but it does mean that retailers need to acknowledge that gift choice is becoming more fluid and preference-driven across age groups.
The trend toward healthier digital and physical gifting formats — especially e-gift cards — does feel durable rather than fleeting, anchored in consumer expectations for convenience, personalization, and flexibility. E-gift cards, for example, continue to grow because they eliminate issues like shipping delays and lost packages, and they integrate into mobile wallets and loyalty programs that retailers increasingly depend on for engagement. Even so, physical gift cards and wrapped presents still hold emotional value and are preferred by many for special occasions or when the gesture itself is part of the experience.
For retailers, the opportunity isn’t to defend traditional gifting so much as to expand choice and meet consumers where they are. That means not only offering both physical and digital gift cards — but also weaving digital payments, personalization, and omnichannel convenience into the gifting journey. Retailers can tie digital options into loyalty programs, offer curated e-gift experiences, and even enable “choose your own adventure” gift cards that can be split across brands or experiences. In a world where consumers value flexibility and speed without losing meaningful connection, the smartest players will treat digital gifting as another tool in a broader gifting ecosystem rather than a threat to tradition.
Gift cards are nothing new; they have been a big part of gifting occasions for decades. Their evolution into digital gift cards and digital cash gifts doesn’t pose a threat to traditional gift giving, which still represents countless billions and forms of the bulk of the gift market.
If anything, it’s a risk to gift wrap and ribbon sales:).
There are times at which a specific gift hits the right note and fills a specific desire. For all other times, the electronic gift allows the recipient of the digital cash to spend the money as they wish and using the gift to buy what they want rather than what the gift giver thinks the recipient wants. The downside of digital payments as gifts to retailers is that the recipient may not want to spend all of the gift on a purchase, thus potentially diminishing the amount spent on retail products. Conversely, someone receiving an actual gift they do not want, can just return it for credit towards another product. The bottom line may be a break even to retailers..
Article emphasizes the favorability by youth. Is that any correlation to fewer close best friends… or less quality time with family?
As a child I was allowed to make a list, and then parents or Santa would pick something off the list (I would be surprised as to which) plus any item that was more necessity at the time.
This phrasing made me wonder about how close (family or friend) relationships are. Do you know the recipient well??
“ appreciating digital cash because they don’t like most of the physical gifts they receive during the holidays.”
Why is this a threat? Unless the recipient buries it in a hole, or forgets about it, it still ends up getting spent (by someone)…right ?? (I’ll take “Fake Problems” for $500, Alex)
Now if you want to ask is this a threat to thoughtfulness and good taste and….well, don’t get me started.
People may spend it on subscriptions to AI chatbots. Is that like burying it in a hole?
Let’s see:
Paid Subscription Plans
You can upgrade inside the ChatGPT website or app — usually by logging in and selecting “Upgrade” or “Manage Subscription.”
ChatGPT Plus
About $20 per month (USD).
Faster responses, higher usage limits, advanced models, more features than Free. OpenAI
ChatGPT Pro
Around $200 per month.
Deep, DEEP, DEEP!!
I don’t see digital gifting as a threat so much as a natural shift. Decades ago, cash was part of holiday giving but now digital gifting is just a more convenient, modern version. Younger generations are already moving away from physical wallets altogether, preferring to manage money, passes, and gifts through digital wallets on their phones.
For retailers, the opportunity is to make digital feel more thoughtful. Pairing digital gift cards with light personalization, curated suggestions, or easy wallet integrations can bring back some of the emotion of traditional gifts. The goal isn’t to replace gift giving, but to meet shoppers where their habits already are.
Doesn’t the digital or cash gift eventually make its way to the retailer?
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I don’t see the trend toward gifting digital payments, cash, and e-gift cards as an existential threat to traditional gift giving so much as a complementary evolution of how people express appreciation — especially among younger generations. According to the Wells Fargo data that sparked the original conversation, while physical gifts still dominate for most people, a growing share of Gen Z and Millennials are comfortable giving digital payments or e-cash as gifts, driven largely by convenience, immediacy, and the freedom it gives recipients to choose what they want. This doesn’t mean traditional gifts are obsolete, but it does mean that retailers need to acknowledge that gift choice is becoming more fluid and preference-driven across age groups.
The trend toward healthier digital and physical gifting formats — especially e-gift cards — does feel durable rather than fleeting, anchored in consumer expectations for convenience, personalization, and flexibility. E-gift cards, for example, continue to grow because they eliminate issues like shipping delays and lost packages, and they integrate into mobile wallets and loyalty programs that retailers increasingly depend on for engagement. Even so, physical gift cards and wrapped presents still hold emotional value and are preferred by many for special occasions or when the gesture itself is part of the experience.
For retailers, the opportunity isn’t to defend traditional gifting so much as to expand choice and meet consumers where they are. That means not only offering both physical and digital gift cards — but also weaving digital payments, personalization, and omnichannel convenience into the gifting journey. Retailers can tie digital options into loyalty programs, offer curated e-gift experiences, and even enable “choose your own adventure” gift cards that can be split across brands or experiences. In a world where consumers value flexibility and speed without losing meaningful connection, the smartest players will treat digital gifting as another tool in a broader gifting ecosystem rather than a threat to tradition.
Gift cards are nothing new; they have been a big part of gifting occasions for decades. Their evolution into digital gift cards and digital cash gifts doesn’t pose a threat to traditional gift giving, which still represents countless billions and forms of the bulk of the gift market.
If anything, it’s a risk to gift wrap and ribbon sales:).
There are times at which a specific gift hits the right note and fills a specific desire. For all other times, the electronic gift allows the recipient of the digital cash to spend the money as they wish and using the gift to buy what they want rather than what the gift giver thinks the recipient wants. The downside of digital payments as gifts to retailers is that the recipient may not want to spend all of the gift on a purchase, thus potentially diminishing the amount spent on retail products. Conversely, someone receiving an actual gift they do not want, can just return it for credit towards another product. The bottom line may be a break even to retailers..
Article emphasizes the favorability by youth. Is that any correlation to fewer close best friends… or less quality time with family?
As a child I was allowed to make a list, and then parents or Santa would pick something off the list (I would be surprised as to which) plus any item that was more necessity at the time.
This phrasing made me wonder about how close (family or friend) relationships are. Do you know the recipient well??
“ appreciating digital cash because they don’t like most of the physical gifts they receive during the holidays.”
Why is this a threat? Unless the recipient buries it in a hole, or forgets about it, it still ends up getting spent (by someone)…right ?? (I’ll take “Fake Problems” for $500, Alex)
Now if you want to ask is this a threat to thoughtfulness and good taste and….well, don’t get me started.
People may spend it on subscriptions to AI chatbots. Is that like burying it in a hole?
Let’s see:
Deep, DEEP, DEEP!!
I don’t see digital gifting as a threat so much as a natural shift. Decades ago, cash was part of holiday giving but now digital gifting is just a more convenient, modern version. Younger generations are already moving away from physical wallets altogether, preferring to manage money, passes, and gifts through digital wallets on their phones.
For retailers, the opportunity is to make digital feel more thoughtful. Pairing digital gift cards with light personalization, curated suggestions, or easy wallet integrations can bring back some of the emotion of traditional gifts. The goal isn’t to replace gift giving, but to meet shoppers where their habits already are.
Doesn’t the digital or cash gift eventually make its way to the retailer?