Gen Y wants alternative banking options

Younger bank customers are nearly twice as likely as older customers to consider switching to a branchless bank. They’ll also consider banking with major technology players, according to a report by Accenture.

Read: How tech helps Gen Y with finances

In fact, 39% of customers 18- to 34-years-old would consider switching to a branchless bank, compared with 29% of customers 35 to 55, and 16% of customers over 55. In Canada, 27% of all bank customers would consider a branchless digital bank if they were to switch financial institutions.

Further, young consumers would be open to banking with technology players such as Google, Amazon and Apple if the companies offered such services. Among consumers ages 18 to 34, 40% would consider banking with Google, 37% with Amazon, and 34% with Apple. This compares to 5%, 7% and 6%, respectively, for respondents over 55.

Read: Gen Y turn to parents for advice

“The game is changing for banking in Canada and the U.S., and tomorrow’s consumer is coming of age with a very different perception of what a bank could be,” says Jodie Wallis, managing director of Accenture’s Canadian banking practice. “These new customer expectations will prove disruptive to banks, if non-bank entrants gain momentum and if banks do not adapt quickly.”

Read: 5 ways to understand millenial clients

Additional findings for Gen Y include:

• In Canada, 60% would bank with a major technology, telecommunications or shipping/postal player, such as Rogers Wireless, Bell Mobility, TELUS Mobility and Canada Post;
• 55% would like their bank to help with the “heavy lifting” of car-buying and provide discounts in that process;
• 57% would welcome more help from their bank in the process of purchasing a home; and
• 68% expressed interest in receiving real-time analysis of their spending from their bank, including “safe-to-spend” forecasts.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.