This study explores the preferences and factors influencing the use of digital payments among Generation Z in Indonesia, a demographic known for its high tech-savviness and increasing financial independence. The study delves into the factors influencing their preference for digital payment methods, such as ease of use, convenience, security, and promotional incentives. Through qualitative research involving 14 respondents, this study identifies key factors influencing digital payment adoption: ease of use, convenience, security, and promotional incentives. Despite widespread use of digital payments, challenges persist, including inconsistent internet access, device limitations, and a lack of digital payment infrastructure among Micro, Small, and Medium Enterprises (MSMEs). The findings suggest that improving digital literacy for MSMEs and expanding internet access are crucial to foster greater financial inclusion and boost financial literacy, particularly among younger Indonesians. To achieve this, coordinated efforts from the government, educational institutions, and the private sector are essential to bridge the digital divide and promote sustainable business practices.