Article after article comes out about how millennials are changing the workplace. They don’t buy into the systems of old. They are more informed and educated than any group in history and grew up being hit with the global financial crises right when they were getting started in the work force.
It should come as no surprise that this group is also different when it comes to their interactions with the banks, which have earned themselves the title of the dark evil in their eyes. The banks have an interesting opportunity to adapt their services and offerings to this up and coming generation.
Every generation has financial goals. In the recent past it has been financial independence with home ownership and a stable retirement savings supplemented by Social Security and pensions. It should come as no surprise that the banks have focused on these goals with a variety of products including increased mortgage lending (we all know how that worked out), home-equity loans, and investment and retirement advisors focused on creating relationships based on local branches.
Millennials ultimately have different goals, but the banks have not adjusted their offerings to meet them. For starters this generation has the greatest levels of student loan debt. This makes major purchases like homes and retirement savings will be pushed back. The current product offerings don’t make sense to this generation.
One would think that the banks would be innovative and find ways to offer products that make sense, but so far this hasn’t been the case. Instead of focusing on home purchasing products it seems to make sense to offer new ways to refinance and/or consolidate the student loans.
It’s also true that millennials are more comfortable than ever at using automated services and online entities to handle their finances. They have no interest in fees, and are happy to find another service that avoids them. This group demands being able to handle all of their banking from their mobile device, and if help is needed a banker can be reached with the click of a single button. Banking needs to be streamlined and simplified.
Some will say millennials are annoying customers, but if you really think about it, they want the same features everyone wants. What sets them apart is that they demand it, and will easily go elsewhere. If the big banks fail in this emerging environment it won’t be because they failed to innovate to the needs of millennials, it will be because they failed to innovate to the needs of all their customers.