Navigating millennials in banking: Capturing the impending generational wealth transfer
With millennials bringing forth a major international wealth transfer, navigating their financial status and positioning themselves to secure and evolve bank or credit union relationships, regional and community financial institutions are poised to respond to the unique needs of this generation — setting the stage for growth.
Rapid technological advances and significant socioeconomic shifts have positioned financial institutions at the cusp of a major generational transition. Millennials, who represent ages 28 to 44, are often defined by their tech dependence and unique financial challenges and have been an ongoing acquisition target for banks and credit unions. This demographic’s distinct behaviors and preferences have set the course for new banking practices and strategies; financial industry leaders are racing to innovate the digital banking experience alongside a product portfolio that will capture the largest intergenerational wealth transfer in history.
Alkami recently conducted a national generational study that included a rigorous methodology with 1,500 participants weighted to the 2020 US Census for age, gender, region, and ethnicity. All respondents currently have a bank or credit union account and are active in digital banking. From the rising interest rate environment to the opportunities for regional and community financial institutions (RCFIs), the research explored a variety of millennial financial trends, beliefs, behaviors and preferences.
The Generational Trends in Digital Banking Study reveals that for millennials, the price of entry for financial institutions is an exemplary digital banking experience, where the digital banking channel is equal parts sales and service. The path to differentiation comes with data — banks and credit unions will need to leverage data and artificial intelligence in banking (AI) to deliver increasingly personalized offers, thereby evolving into the data-informed digital bankers of the future.
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