There are many candidates targeting this strategic clientele: online banks, traditional banks, neobanks... These players are adapting their offerings to meet the needs of Millennials.
Millennials or Generation Y are people born between 1980 and 2000. These young technophiles have different perceptions and expectations of banks than their parents. More demanding and less loyal to brands, they prefer instantaneous service.
What are the banking expectations of Millennials?
A survey of 1,168 Millennials conducted by Arcane Research reveals that most are customers of a traditional bank, while almost 30% have an account with an online bank. When choosing their bank, Millennials place particular importance on the digital operation of their account and on recommendations from friends and family.
Wishing to take advantage of the best services, this generation has no regrets about turning away from establishments that no longer meet their expectations. Having a well-established branch network is no longer enough to retain these modern customers. The strategies that pay off are those based on new in-branch or social banking services, technological agility and a sufficiently high level of security to reassure Millennials, who need to understand who holds their data and how it is used.
Nearly 4 out of 10 Millennials plan to change bank in the future, compared with 1 in 4 of those aged 35 and over. There are a number of reasons for changing banks: rates that are too high, better terms and conditions, lower mortgage rates... Hence the need for these players to adapt their offers to the competition.
Mobile banking booming
According to a study published by Arcane Research, Millennials prefer to use mobile applications to consult their accounts or savings, or to carry out actions on their bank card. Players born in the age of the smartphone, and in particular neobanks, are responding perfectly to the expectations of Generation Y by offering fast, simplified account opening via mobile. Other specific features explain their success: instant money transfer, creation of kitty groups to share expenses, real-time bank card settings, free or virtually free banking services...
While the popularity of neobanks is undeniable, their offerings remain limited to current accounts and certain savings products. Indeed, only Orange Bank offers consumer credit, while Revolut has recently launched an overdraft facility and investments.
Attracting Millennials: a challenge for banks
Meeting the new expectations of 21st century consumers represents a real challenge for banks. These players need to reinvent themselves to keep pace with the priorities of the digital age. Even if fintechs seem to respond better to the needs of Millennials with their "all-digital" approach, traditional banks can still play the proximity card. Indeed, a physical presence that can deliver instant, personalized service can be a real competitive advantage.
In addition to monitoring their e-reputation, traditional banks need to be able to offer a 100% digital customer experience. Putting you in touch with an advisor by email, making online comparators available, creating an online community of customers... these are just some of the tools that meet the expectations of digital-natives.