The trajectory of banking – How the different generations are driving the changes in banking
By Philipp Buschmann, CEO and Co-founder of AAZZUR
We are living in very exciting times, the huge advancements in technology have transformed the way we work and live, impacting every cornerstone of our lives. This surge in our use of tech for everyday things has been noticeable in the way we interact with our finances. The days of queuing up for hours in a bank to make a simple transaction are over, now all we need is a device such as a mobile, tablet, or laptop to make a few clicks and make a transaction, this has saved us a lot of time and has overall made banking much more convenient.
The trajectory of banking is constantly evolving and being shaped by various factors, such as advances in technology, changes in regulations, and shifts in consumer behaviour. Some of the trends that are currently impacting the trajectory of banking include:
Digitalization: The rise of digital banking has been one of the biggest shifts in the industry in recent years. Banks are increasingly offering online and mobile banking services, and many are investing in artificial intelligence, machine learning, and other technologies to improve their digital offerings.
Fintech disruption: Fintech companies are using technology to offer innovative financial services that challenge traditional banking models. Many banks are responding by partnering with fintech firms or developing their own fintech solutions.
Regulatory changes: Banks are subject to a wide range of regulations that impact their operations, and new regulations are constantly being introduced. These can impact the products and services banks can offer and their profitability.
Changing consumer behaviour: Consumers are increasingly looking for convenience, speed, and personalised experiences in their banking interactions. Banks are responding by offering more tailored products and services, and improving their customer service and user experience.
Overall, the trajectory of banking is toward increased digitization, greater competition from fintech firms, and a focus on providing personalised, convenient services to customers.
Interestingly, each generation has unique preferences and expectations when it comes to banking and finance, and these preferences and expectations are driving changes in the industry. Here are some of the ways that different generations are influencing banking and finance:
Baby Boomers (born 1946-1964): Baby Boomers tend to be more traditional in their banking habits and prefer in-person interactions with bank employees. They value stability and security and are more likely to stick with established banks rather than switch to online-only banks. However, they are also starting to demand more digital banking services as they become more comfortable with technology.
Generation X (born 1965-1980): Gen Xers are more likely to embrace technology and are comfortable with online banking and mobile apps. They value convenience and are more likely to switch banks if they find a better deal or more convenient services. They are also starting to demand more personalised services and products from banks.
Millennials (born 1981-1996): Millennials are the first generation to have grown up with the internet and are highly tech-savvy. They value convenience and expect seamless digital experiences from their banks. They are also more likely to prioritise social responsibility and environmental sustainability when choosing financial institutions.
Gen Z (born 1997-2012): Gen Zers are even more tech-savvy than Millennials and are highly reliant on mobile banking and digital services and out of all the different generational groups, Gen Zers are driving tech within banking and finance the most. They value transparency and expect their banks to be transparent about fees and charges. They are also more likely to prioritise diversity and inclusion when choosing financial institutions.
Overall, the changing preferences and expectations of these different generations are driving banks and financial institutions to adapt their offerings to meet the needs of each generation. This is leading to more personalised and convenient banking experiences for customers. This increase in personalisation also means that customers are offered financial products and services at the point of need, if say someone is booking a holiday, before they checkout they will now have the option to purchase travel insurance, whereas previously they would have to shop elsewhere for the related product. Now that banking has become more personal, each generation can benefit from high levels of convenience when making financial transactions
About Author:
Philipp Buschmann is co-Founder and CEO at AAZZUR, a one-stop-shop for smart embedded finance experience. Recognised as a rising star in the FinTech space, AAZZUR’s mission is to build profitable banking whilst at the same time empowering consumers to have access to better informed financial choices.
Philipp is a serial entrepreneur with extensive experience of working in Challenger Banking, Financial Services, IT and Energy across the world. He took one of his businesses public – Ignis Petroleum was publicly listed in the US and Germany.
Having started as a developer in Financial Services, Philipp has first-hand experience of the banking revolution from both a technology and financial perspective. His interest in behavioural economics helped inspire AAZZUR’s revolutionary work on customer centricity in banking.
Philipp holds an MBA from the London Business School. He is passionate about entrepreneurship and loves exchanging ideas, insights and discussing FinTech’s future. He has spoken at major Fintech events including Money 20/20, MoneyLive, Finovate, Fintech Matters, and the Future of Retail Banking.
