Millennials have long been portrayed as poles apart from other generations served by the financial industry, but new research from Jacksonville, Florida-based financial software company FIS suggests some millennials actually aren’t that different from Gen Xers when it comes to banking habits and preferences.
The survey, conducted in December 2016, asked 8,000 millennials, Gen Xers and baby boomers in eight countries to rank the importance of key parts of the banking experience and how well their banks reflected those attributes. It found that both older millennials (age 26-36) and Gen Xers (age 37-51) in the United States, United Kingdom, Germany and other countries are more likely to use regional banks as their primary financial institutions, both handle about 75% of their banking activities online or via mobile and both share — in the same order — the same 10 most important financial institution attributes.
This combined demographic of older millennials and Gen Xers, dubbed “Gen MX,” is now in the driver’s seat of the global economy, according to FIS COO of Banking and Payments Anthony Jabbour.
“This super segment of consumers earn more than any other age group, are starting and running businesses, and are about to inherit the biggest transfer of wealth in history. They are accustomed to using digital channels to manage their personal lives, and they want the same level of digital experience in their banking and business relationships,” he said.
About two-thirds of senior millennials and about half of Gen Xers are planning at least one major life event in the next two or three years that will have a financial impact, according to FIS, and both segments prefer to use their primary banking providers when they need help with their finances.
The study also noted a rift in the mobile habits of young millennials and older millennials: young millennials make almost twice as many mobile payments as senior millennials. Senior millennials still make four times the number of mobile transactions as Gen Xers, however.
“Providing digital payments options, including mobile wallets and P2P options may not yet be table stakes beyond millennials in some countries. But it’s getting there, as the importance of digital payments increased significantly in our current U.S. PACE study,” FIS reported.
“To gain ‘top of phone’ status, banks must fight to become the dominant P2P provider as payments shift from plastic and paper to digital,” it added.
The study surveyed consumers in Australia, Brazil, Canada, Germany, India, Thailand, the United Kingdom and the United States.
Here are some other findings from the FIS study:
• Banking consumers around the world most value safety, security, fairness and constant access to their finances — in that order. These attributes and their rankings have stayed the same for the three years FIS has done the study.
• Simplicity became the sixth most important attribute, up from eighth most important in 2015.
• Digital payments became the eighth most important attribute, up from 12th in 2015 and 2016.
• Mobile payments grew more than any payment type from 2016 to 2017.
• Younger consumers are more likely to be unhappy with their financial institutions, but they also make more contacts with their banks than older generations.
• The U.K. had the highest percentage of “financially unhealthy” respondents at 23%, followed by Australia (22%), Canada (18%), and U.S. (17%).
