A recent study shows that developing a strong digital customer experience could woo younger generations still searching for their primary bank.
The younger demographic desires opportunities to improve their financial literacy but fears traditional financial institutions misunderstand their needs.
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The news: Regional and community financial institutions (FIs) should focus on their digital experience to snag younger generations not yet sold on a bank, according to a study by Alkami.
The study included 1,500 US participants who have a bank account and use digital banking and was weighted according to the 2020 US Census for age, region, gender, and ethnicity.
By the numbers: The study reveals links between a quality digital customer experience and customer stickiness.
Only 27% of regional and community customers believe their relationship will grow with their institution over the next year, as opposed to 51% of neobank customers, and 53% of fintech customers.
But 40% of current regional and community customers would be willing to try, use, or engage with more products if they had a satisfying digital banking experience.
Regional and community institutions have room to grow when it comes to new customer acquisition and competing with neobanks and fintechs.
45% of baby boomers and 38% of Gen Xers use regional and community FIs, versus 16% of Gen Zers and 18% of millennials.
40% of millennials and 38% of Gen Zers use neobanks, fintechs, and Big Tech compared with 6% of boomers and 21% of Gen Xers.
The digital experience: By focusing on developing a better digital experience, regional and community institutions can nab younger generations that haven’t found their primary financial institution.
25% of Gen Zers and 21% of millennials don’t think or are unsure if they’ll be with their primary FI in one year.
And these generations are quicker to …read more
Source:: Business Insider