Millennial: one of the greatest buzz words to ever rock the industry. It excites some people, while striking fear in the hearts of others. There are a lot of articles out there explaining millennials, but they are typically very broad. I am a millennial with experience working with financial institutions. So, I decided to put together a list that explains the quirks of millennials that are relevant to banks.
1. ) We want convenience
This may be a no-brainer, but that doesn’t make it any less true. We want the least amount of friction for every part of our lives. It explains the rise in popularity of order-ahead apps and Amazon Alexa. The same sentiment goes for financial institutions. We prefer online statements, easy to use mobile banking and automated technology. When we do have to walk into branches, because we only walk into branches when we absolutely have to, we want the process to be efficient and convenient.
2.) We want advanced technology
Millennials are by far the most interested generation in automated technology. According to a study done by JD Power, 56% of millennials trust self-driving cars while only 41% of Generation X trust them. That number is almost halved for baby boomers and pre-boomers (23% and 18% respectively). So how does this translate to banking? Invest in your technology! Almost 70% of millennials are using mobile banking while only 34% of people between the age of 45 and 59 are according to a report by the Federal Reserve. The number will only increase in the upcoming years, so make it a top priority or your institution will find itself behind the curve.
3.) We are open to engaging with financial institutions
When asked, “Do you trust banks?” millennials, not unexpectedly, will answer no most of the time. However, when you dig into what millennials are actually doing, it is a different story. Millennials are 4 times as likely to use a personal finance tool through their primary financial institution as opposed to any other source (FIS consumer banking pace index). Additionally, 75% of millennials say they don’t receive too many offers from financial institutions, but 2 out of 5 complain that the offers they do receive are not tailored to their needs, showing that we are open to banking products if they are personalized. (The Financial Brand).
4.) We go through life at different paces
What makes millennials so hard to read is that each millennial is so different from the next. If you think about the stereotypes you have heard about millennials, it is likely that there are just as many millennials on the opposite side of that stereotype. This means that personalization is key. However, since only 26% of millennials go to bank branches more than once per month, personalization will need to be automated and facilitated by highly advanced artificial intelligence, like what we are working on over at Monotto.
Ultimately, the industry is moving in the right direction. Most financial institutions are investing in technology and seeing great returns. If your institution is considering new technology but you aren’t sure where to start, check out my post on how to work with FinTech companies. If you want to take one lesson away from this post, let it be this: millennials want advanced technology that is automated, personalized and convenient. When you are able to provide this, we will flock to your institution.
Originally posted at CBInsight