Gen Z’s Spending Power Gives Issuers a Holiday Boost

Earnings season so far suggests that U.S. consumers still have a willingness and capacity to spend, even amid persistent economic uncertainty. Credit and debit cards remain the tools of choice to sustain that spending. Younger consumers are emerging as an increasingly important source of that momentum heading into the holidays.

As detailed in PYMNTS’ coverage of JPMorgan Chase’s third-quarter earnings, the nation’s largest bank reported that card spending rose about 9% year over year. The results underscored steady transaction growth across households and small businesses, even as savings cushions eroded.

Bank of America’s earnings report showed a similar picture, with total combined credit-and-debit spending up 6% from a year ago — marking the third consecutive monthly gain.

Generational trends were especially visible at American Express. In its third-quarter earnings release, commentary and related materials, Amex reported that Gen Z and millennials now account for 36% of total card spend — equal to Gen X — while total billed business rose 9% year over year. PYMNTS noted that younger consumers are contributing meaningfully to card activity despite lingering macro headwinds, particularly through online and mobile channels.

Recent PYMNTS Intelligence data provide additional context on how these consumers are balancing credit, debit and savings. A July 2025 report, “How People Pay: Payment Choice Depends on Shopping Channel,” found debit cards account for 42% of all in-store transactions, while credit cards and digital wallets dominate online checkouts. That suggests consumers overall are tactically managing their payment choices — using debit for day-to-day essentials while turning to credit for higher-ticket or digital purchases.

A September PYMNTS Intelligence study, “Study Shows Gen Z Saving Harder Even as Costs Rise,” revealed that Gen Z consumers have an average of $5,948 in liquid savings, compared to $8,594 for millennials. Despite lower balances, Gen Z allocates a larger share of income to saving than any other generation. This blend of caution and capability helps explain why younger consumers can keep participating in the economy while still preparing for uncertainty.

Taken together, these trends reveal a generation that is both resilient and deliberate. Gen Z and millennials are not spending recklessly; they’re strategically balancing debit and credit to maintain momentum without over-extending. For financial institutions, that balance represents an opportunity: debit growth reflects strong account engagement, while sustained credit card use demonstrates loyalty potential.

American Express’ rising share of younger cardholders highlights how reward programs and experiences resonate with this cohort.

For now, younger consumers are the steady hand on the spending tiller. They’re comfortable moving between debit and credit, saving consistently, and using digital tools to manage budgets in real time. For merchants and issuers preparing for the holiday rush, that behavior means opportunity — and possibly a lifeline. American Express CFO Christophe Le Caillec said those cohorts are also spending in volume, noting that “the average number of transactions per U.S. customer [in the younger group is] about 25% higher than the older cohort.”

Even amid mixed macroeconomic signals, the willingness of Gen Z and millennials to keep transacting may provide a floor under holiday spending.

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