One in four millennials (26%) – those aged between 18-34 – have never switched from their childhood bank account
This is despite the fact that less than one in three (32%) believe their bank offers relevant products to meet their needs
Online services (17%) are more important than customer service (13%) for young people – while almost one in ten (8%) chose their bank because of its mobile service
Six in ten (59%) haven’t set foot in a branch in the last three months, with over three quarters (77%) choosing online banking instead
A quarter (24%) believe that tech companies, like Google and Amazon, would do a better job of offering relevant financial products.
Young Brits say banks are out of touch with their generation, yet over a quarter (26%) have never switched from the childhood bank account set up for them by their parents. That’s according to new research from https://www.uswitch.com/banking/>Uswitch.com, the price comparison site and switching service, which reveals that just 32% of 18-34 year olds believe their bank offers products to help them deal with the financial challenges faced by their generation.
Many have never used key products offered by their banks, with a fifth (22%) having never deposited a cheque and 62% not taking advantage of the mortgage services on offer. Instead, millennial customers are looking for easy to digest advice to help them with their short and long-term financial goals. The wish list includes help with how to improve their credit history (20%), clear information on savings and pension products (20%), as well as general advice on how to better manage their money (20%) .
Young people are also looking to their banks to help them stay on top of their monthly outgoings, with more than two thirds (67%) saying they would like to be alerted via their banking apps for higher than expected bill payments and automatic blocks if card transactions take place in a different location to their phone (65%).
The research also reveals that millennials rated online services (17%) as more important that customer service (13%), and almost one in ten (8%) chose their bank because of its mobile service. And given that many don’t make it into a bank, it’s hardly surprising that young people are more annoyed by poor mobile services offered by their bank (14%), than by not having a local branch (11%).
The ease and convenience of online banking is seeing younger people turn their back on their local branch. In the last three months, almost six in ten (59%) haven’t set foot in one, whereas more than three quarters (77%) logged into their online banking. A fifth (21%) used their mobile banking app to keep an eye on their finances.
Given that many millennials don’t feel their bank is ticking the boxes, it’s hardly surprising that they are open to considering new providers. Their preference for the virtual over the real world is reflected by the fact that almost a quarter (24%) of young people believe tech companies such as Google, Apple and Amazon would do a better job than their bank. A further 18% would place supermarkets above banks for offering relevant products for their generation.
Nicolas Frankcom, money expert at Uswitch.com says: “This research exposes a contradiction: young people clearly don’t feel that banks meet their needs, yet many remain tied to the bank they joined as a child. But thanks to seven-day switching, it’s quicker and easier for millennials to find a bank that offers what they’re after.
“Millennials have unique needs, and so far, most banks seem to be missing the mark when it comes to catering for these. The banks must work harder, with more innovation around relevant products and services if they are to attract the custom of this generation. If they don’t, someone else will – our research already shows that tech giants like Google Apple and Amazon are emerging as credible alternatives for younger consumers.”
All research referred to was conducted by Opinium unless otherwise stated. Opinium Research carried an online survey of 1,005 UK consumers aged 18 – 34 between 2nd – 8th July 2015.
When asked ‘Thinking about who your main bank account is with (e.g. current account), why did you choose to bank with them originally? If you have more than one bank account, please answer for what you consider to be your MAIN current account’ 26% answered ‘My parents set the account up for me as a child, and I’ve just stayed put’; 17% said ‘Its online service’; 13% said ‘Its customer service’; 8% said ‘Its mobile service/ app’.
When asked ‘Do you think your bank adequately tailors its products and services to the specific financial challenges younger people like you face? In total 32% answered ‘Yes’
When asked ‘In the last three months, how have you interacted with your bank’ 77% said either ‘logged on to my internet banking from my desktop’ or ‘logged on to my internet banking from my mobile’ or ‘logged on to my banking app’ (21%). 41% said either ‘Used an in-branch ATM’, or ‘Talked to a cashier in branch’ or ‘Set up a meeting with an advisor in branch’. This equates to 59% who haven’t been in branch in the last 3 months.
When asked ‘Which, if any, of the following organisations do you think would do a better job than a traditional bank of offering you financial products in the way you need them?’ 24% said tech companies (Google, Apple, Amazon, Facebook or Samsung); 18% chose supermarket brands (Tesco, Sainsbury’s or ASDA).
When asked ‘Thinking of the services offered by your bank, which of the following have you NEVER used?’ 22% said ‘depositing a cheque’; 62% said ‘mortgage services’.
When asked ‘Which financial issues do you face that you’d like your bank to help you address with more tailored and innovative products?’ 20% answered, ‘How to improve my credit score’, 20% answered ‘Building savings / pension for the future’, and 20% answered ‘How to better manage my money’
When asked ‘What services would you like to see from your mobile banking app in the future?’ 67% answered ‘Notifications for when bills are significantly higher than usual e.g. phone bill, water bill’, and 65% answered ‘Fraud team at my bank automatically alerted if transactions take place from a different location to my phone’
When asked ‘When dealing with your bank, what frustrates you? 14% said ‘poor mobile app’, ‘non mobile friendly website’ or ‘no mobile app’; 11% said ‘no local branch’.
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Uswitch is the UK’s top comparison website for home services switching. Launched in September 2000, we help consumers save money on their gas, electricity, broadband, mobile, TV, and financial services products and get more of what matters to them. Last year we saved consumers over £373 million on their energy bills alone.
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