Published by Jessica Weisman-Pitts
Posted on November 1, 2022
6 min readLast updated: February 3, 2026
By David Donovan, EVP of Financial Services, Publicis Sapient
One fifth of the US population, or roughly 68 million people, was born between 1997 and 2012. They are Gen Z. The need to understand Gen Z and how to meet them where they are is obvious, and that need is even greater in financial services – an industry built by and for Boomers and Gen Xers. The financial industry is moving in the right direction, but few have managed to capture and delight Gen Z. Gen Z is a whole new ball game, and the industry as a whole has far from mastered the Gen Z mindset.
Gen Z is unique in history, and this cohort will change the face of banking. Gen Zers will be the dominant banking consumers in the next decades, redefining digital engagement as well as financing and payments. They were born into the age of the internet, live in the digital world, and seek services that align with their values and views on society and the environment. This is a generation that does not bank traditionally. In fact, the number of Gen Zers who use digital-only banks is expected to grow steadily by 2025. Additionally, less than half have a financial account with a traditional bank, credit union, neobank, or technology company at the moment. They also get their financial advice from platforms like YouTube, Instagram, and TikTok.
Gen Z has completely different behaviors when compared to previous generations and banking institutions need to take action now to win over this generation. The question is: How can the banking industry bridge the gap with Gen Z?
Be authentic and build trust
Gen Z respects but doesn’t easily trust financial institutions. They are somewhat skeptical of traditional financial institutions, prefer digital and mobile financial tools, and seek investments that reflect their values and goals. Some of Gen Z’s distrust in financial institutions has driven them to cryptocurrency and other alternative investments to hedge against the perceived pitfalls of traditional investing. However, finances remain a top source of stress for Gen Zers. The global pandemic has exacerbated their financial anxiety and made them more cautious, risk- averse, and debt avoidant. They want services from banking institutions that they can trust in an ever-changing and often unpredictable economic climate.
They are also highly informed and engaged with social and environmental issues and sift through the growing digital-first market with a filter for social issues they care about. They are highly informed and engaged with social and environmental issues. They actively seek out socially responsible investment – companies that are vested in helping bring change about. They care about diversity, equal representation, climate change, health care, mental health, and higher education.
Therefore, Gen Z will expect their banks to uphold principles the generation holds dear. Lip service is no longer good enough – Gen Z wants to see authentic action and commitment. In fact, nearly 60% of Gen Zers would switch their financial services provider to one that is more committed to diversity, equity, inclusion, environmental, social, and governance issues. Banks should be taking steps to show that it’s trustworthy and transparent, offer options for ESG-linked investing, and make commitments towards preserving the environment.
Offer better personalization and experiences
Recent research shows that 83% of Gen Z consumers report being frustrated with bank processes, which implies that banks and other financial institutions will need to examine their customer experience at a micro level to please younger customers and develop loyalty. Gen Z prefers doing finance online, and expects customer support at their fingertips, not over the phone or at the branch. They want frictionless and seamless experiences, and banks should be focusing on simplicity and ease of use. Banks should also be designing their mobile apps for better, more seamless user experiences as it has become essential for Gen Z, with 97% accessing their bank account through a mobile device.
Engaging customer experiences are critical to the sustained growth of any business, financial services included. Banks will need to use data at a granular level to ensure that young people are reached in a way that shows they are “known” and “understood.” They need to be leveraging technology for algorithms that better suggest relevant recommendations, provide a personalized shopping experience, reduce the friction between purchase desire and checkout, and be more engaging with the use of in-app filters, and live streams. Gen Z will expect immersive experiences, likely to happen in the metaverse. Banks should also be considering exploring the use of VR/AR both for engagement and service delivery.
Engage with them where they are
Gen Zers spend a lot of time online. They were born into the familiar reality of fast-speed internet in our pockets, and nearly 80% got their first smartphone around the age of 12. They are also the biggest users of social media and online gaming. In the US, Gen Z relies heavily on social media platforms to consume, share, and connect. In fact, 61% of them use social media to get the daily news. This provides a great opportunity for banks to emphasize their presence across the popular social media platforms with platform-catered content that goes beyond selling a service.
Research has shown that Gen Z has an average attention span of 8 seconds. If you don’t grab their attention fast – you lose them, potentially permanently. Engagement from banks will have to become more intuitive. Engaging on social media will also help keep the finger on the pulse and constantly improve accessibility to emerging payment options. This can help inform consistent improvements to its apps and features so that Gen Zers don’t lose interest and perceived value in service.
Build communities and become a trusted source for financial literacy
Research shows that Gen Zers are highly engaged and very interested in finance. Gen Z ranks understanding finance as a high priority, despite not getting a lot of opportunities to learn about it in school. This generation will turn to online sources to educate themselves, along with learning from their parents. Gen Zers also don’t traditionally trust regular media and have a community centric model for learning. As a result, 56% of Gen Z intentionally seek out information or advice about personal finance online or through social media platforms, with the majority of Gen Z seeking this information on Instagram and TikTok.
This presents an opportunity for banks as purveyors of financial literacy. To attract and retain Gen Zers, banks will need to develop products that offer value, are authentic, and educational. Banks should be providing tools and services to educate their customer base and improve financial literacy. Engaging with and creating these financial education communities will be key in reaching Gen Z.
Gen Z will change the face of banking forever. Banking institutions need to not only understand who Gen Z consumers are, but also how to capture and delight them.
Digital banking refers to the use of digital platforms and technologies to conduct banking transactions, manage accounts, and access financial services online.
Financial literacy is the ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing.
Sustainability in finance refers to the practice of making investment decisions that consider environmental, social, and governance (ESG) factors to promote long-term positive impacts.
Neobanks are digital-only banks that operate without physical branches, offering financial services primarily through mobile apps and online platforms.
Cryptocurrency is a digital or virtual currency that uses cryptography for security and operates on decentralized networks based on blockchain technology.
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