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PULSE Perspectives – July 2025

Author Svetla Pavlova

A road stretches to the horizon with the sun and clouds in the background

PULSE offers its perspective on news, analysis, and research in payments and banking. In this issue: debit use in leading digital wallets soars; Buy Now, Pay Later (BNPL) risks rise; and toll and text scams proliferate.
 

Debit Use in Venmo and PayPal Soars

Venmo and PayPal's total debit payment volume surged 60% in the first quarter of 2025, with almost 2 million new debit card users added, reports CNBC. This growth highlights Venmo's increasing role in PayPal’s revenue, despite competition from Zelle and Square Cash.

Perspective: This growth highlights how Venmo is evolving from a simple peer-to-peer payment service into a key revenue driver for PayPal. PULSE recommends financial institutions innovate with seamless digital solutions, explore partnerships, and differentiate with security features to meet evolving consumer needs.

BNPL Grows and So Does Consumer Spending

A Bankrate study found 24% of consumers overspent using BNPL, especially Gen Z and Millennials. Almost half of BNPL users reported issues beyond overspending, such as missed payments or return difficulties. As many plans become longer-term with interest, risks increasingly resemble those of credit cards.

Perspective: PULSE recommends institutions consider promoting responsible money management. This could include offering debit-linked installment options, transparent terms, and financial education to help consumers manage spending without taking on revolving debt.

Toll and Tax Text Scams on the Rise

Cybercriminals are ramping up SMS text-based “smishing” attacks, impersonating toll agencies and the IRS to steal sensitive data. Victims receive text messages that appear legitimate, but links in the messages lead recipients to phishing websites.

Perspective: PULSE recommends maintaining awareness of the latest fraud schemes and reinforcing mobile security and consumer-education efforts. Institutions can encourage account holders to report suspected toll scams via the Better Business Bureau Scam Tracker and to forward suspicious tax-related texts to phishing@irs.gov.