According to Bloomberg’s analysis of United Nations’ data, Generation Z this year comprises 32% of the global population. By 2020, Gen Z consumers will have a greater impact on global banking and payments than ever before as they encroach on the market and emerge as the main customer base for banks. As the first generation of true digital natives, this transition will create a fundamental shift in how banking is consumed.
Gen Z will drive an increase in conversational finance – specifically chatbots. We have already seen this happen in China, which has a very young population. There, the tech-savvy youth are embracing mobile payments and WeChat Pay at an ever increasing rate – according to Shrey Rastogi, Senior payments Strategist at Temenos. In fact, WeChat Pay is on track to handle one billion payments annually. As China adapts its banking models to suit this new customer base, in 2020 we will see the rest of the world follow suit.
Gen Z may not represent the most profitable customer base for banks at the moment. However, their numbers and influence will soon become so significant that banks will have no choice but to redesign their services to suit their needs and requirements. In 2020, banks will need to incentivise their products and services, adding value, personalisation and even gamification techniques in order to retain a customer base that is by nature less loyal to their bank than previous generations.”
continue reading »