Part 2 of 2: Digital Banking Trends Across the Generations, Millennials and Gen Z
As we discussed in our previous blog, digital banking capabilities are regularly changing— adapting to the rise of different trends and the demands of account holders of varying generations. As digital banking services become commonplace, it’s important for banks and credit unions to understand how younger generations prefer to transact, what their preferred user journey may be, and how to best engage as they enter the workforce and start to make long-term financial decisions of their own.
In this second entry of our series, we look at the similarities, and differences, of Millennials and Gen Zs.
If you missed it, click here to read part 1 where we discuss Baby Boomers and Gen Xers.
Millennials are very technically savvy. Born between 1981 and 1996, this generation was raised alongside modern technology and has come to expect a personalized, digital experience. Convenience is king when it comes to servicing Millennials, and roughly 80% have reported using digital and mobile banking as their preferred method of financial management. Millennials look for rapid, frictionless solutions to meet their immediate needs, often abandoning the solution if stalled for more than 10 seconds. Because of their inclination toward digital and mobile offerings, Millennials expect financial institutions to keep up with their fast-paced lives.
Despite their comfortability with technology, Millennials are also a generation that values authenticity. Knowing that their bank or credit union purposefully designed human touchpoints throughout the banking process is crucial for them to feel engaged. Personalized services such as financial education, and the ability to quickly contact via a chatbot, are simple ways to drive institutional loyalty within this generation of account holders. Millennials also want to know that their bank or credit union cares for them, even if they never visit a physical branch. Finding innovative ways to communicate and appeal to their emotions will help banks and credit unions and retain this generation of bankers.
As Gen Z enters the workforce, it’s important to look at what separates this new generation of employees from those who came before them. Just like Millennials, Gen Z, or those born between 1997 and 2012, were raised alongside rapid technological innovation. Most Gen Zers conduct the entirety of their banking services through remote channels and digital devices on their smartphone, tablet, or laptop. Because they have all devices at-hand, Gen Zs seek a streamlined, consistent user journey across each platform, with functionalities that let them start a transaction on one device and resume on another.
Gen Z is also known for actively seeking out non-traditional means of banking. The rise of neobanks or digital only institutions, cryptocurrency, and other digital services, can in-part be accredited to this younger generations’ inclination towards those who handle financial offerings in a new, cutting-edge way. Gen Zs often look towards communal feedback and conversations with friends before making a financial decision – many of which occur on social media. Having grown up in the era of advertisements also positions Gen Zs to prefer genuine conversations with peers rather than to receive direct commercial messaging. Financial institutions must find a way to lead and advise these discussions on external channels, as well as focus on simple and intuitive user journeys, to attract new account holders and extend their loyalty.
Where do banks and credit unions focus in the new year?
While older generations seek accessibility to new digital offerings, Millennials and Gen Zs already know how to find online and digital banking platforms. Instead, this younger demographic must see why your services stand out amidst the competition. Both groups are well-versed in technology and primarily conduct their banking via remote channels, yet still seek out more personal connections with their chosen financial institutions. Frictionless transactions should be paired with human touchpoints and personalization along each step of the user journey, reinforcing that their institution cares and establishing a unique connection. Digital banking platforms that cater to both desires must be offered if your bank or credit union seeks to onboard and retain these younger generations.
Regardless of the age demographic you’re targeting, data-backed insights and personalized, contextual offers help drive engagement with account holders. Sharing tools or promotions for services linked to their personal financial story leverages empathic banking techniques and positions your institution a trusted advisor.
Alogent’s digital banking team leads the pace of innovation to ensure your bank or credit union is leveraging the most modern platform and capabilities to attract account holders of all ages. NXT, our unified online, mobile, and digital banking platform, is the heart of an institution’s digital ecosystem, built with an open and API-based architecture and an SDK for limitless customization. Paired with hundreds of pre-built configurations to leading industry capabilities, NXT is a robust platform that drives engagement and institutional loyalty.
Missed Part 1 of the Series? Click here Discover the digital banking trends of Baby Boomers and Gen X.
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