U.S. consumer downloads for mobile payment apps such as Venmo and Cash App decreased late last year, even as users kept spending time and money with them.
Buy now, pay later apps Affirm and Afterpay saw respective drops of 4% and 22% for downloads in the fourth quarter of 2024 compared to the year-ago quarter, while downloads of Cash App fell 15% year-over-year in the quarter, and downloads of Venmo were down 13%, according to a Jan. 19 analysis from Wolfe Research.
Downloads for the PayPal app were an outlier among the payment apps that Wolfe Research scrutinized, with user demand for it increasing 15% year-over-year in the 4th quarter.
In some cases the slowdown continued a trend from the previous quarter. Downloads of the Cash App and Venmo mobile apps were down 13% and 21%, respectively, for the third quarter of 2024 compared to the same quarter in 2023, for example.
A spokesperson for San Jose, California-based PayPal — which also owns Venmo — said more people are using the company’s products. Venmo’s engaged user base, the number of people who use the product monthly, grew 4% in the fourth quarter to 64 million, compared with the same quarter in 2024, the spokesperson said in an email, citing comments PayPal CEO Alex Chriss made in the company’s Tuesday earning’s call.
The downward trend late last year might be just a blip, Wolfe Research analyst Darrin Peller said in a note to investors.
“Looking ahead to 2025 we believe that post-election dynamics may reverse some of these trends,” Peller wrote “Potential policy changes favor fund flows into financials, consumer spending is showing signs of acceleration, and confidence levels are rising among both consumers and [small and medium-sized businesses].”
Peller’s note does not speculate on why downloads slowed late last year and the analyst did not respond to a request for comment.
Wolfe Research did not include figures for the full year in its Jan. 21 report, but an analysis from another organization also indicates that fewer U.S. consumers are downloading payment apps.
Payment app downloads in the U.S. dropped 13% in the final quarter of 2024 compared to the same quarter 2023 and were down 1% year-over-year for all of 2024, according to research from the market analytics firm Sensor Tower.
But the news isn’t all bad, said Jonathan Briskman, principal market insights manager for Sensor Tower. Most of the people who are inclined to download payment apps have probably already done so, he said.
“The market is pretty well developed in the U.S.,” Briskman said in an interview this month.
The time spent on payments apps increased by 6% year-over-year in the final quarter of 2024, and other usage measurements, like the number of sessions, are stable, he said.
The money spent on in-app purchases also soared in 2024, rising 13% to roughly $150 billion, compared to 2023, according to Sensor Tower’s report. However, that figure also includes non-payment apps like mobile games. Figures for the fourth quarter were not immediately available.
“People are spending as much time as it seems like they'd like to, for now, on their mobile devices,” Briskman said.
A spokesperson for San Francisco-based Affirm declined to comment on the figures, while a spokesperson for Oakland-based Block — which owns Afterpay and Cash App — did not respond to a request for comment.
To be clear, two of the three app parent companies singled out in the Wolfe Research report recorded profits in their most recent full-year results, although only PayPal has released results for the most recent quarter.
Block reported net income of $951 million for the nine months that ended Sept. 30, 2024 on revenue of $18.09 billion, while PayPal said net income last year declined 2% to $4.15 billion as revenue rose 7% to $31.8 billion. Block is scheduled to release its quarterly results on Feb. 20.
Affirm reported a net loss of $517.76 million for the fiscal year that ended June 30. The buy now, pay later company is scheduled to report its most recent quarterly results on Thursday.
