Digital & Wellness Banking: How Gen Z is Changing The Banking Journey

Generation Z, the cohort born into a world dominated by smartphones and on-demand services, isn't just changing the rules of banking; they are rewriting them. As digital natives, these young consumers, also known as Zoomers, demand a banking journey that is not only digital-first but also deeply personalized, educational, and aligned with their values. As their financial power grows, banks and financial institutions are at a crossroads: evolve or risk obsolescence. The fundamental shift lies in the expectation of a seamless, mobile-first experience. A staggering 99% of Gen Z say they've used a mobile banking app in the last month, with nearly half preferring to manage their finances exclusively through their phones. This preference extends beyond simple transactions; 60% of Gen Z prefer to open a bank account directly from their phones, making a user-friendly, full-featured app a non-negotiable for attracting these customers. Furthermore, about two-thirds of Gen Z (64%) use mobile banking apps more often than any other method to manage their accounts. This digital-first, not digital-only, mindset highlights the need for a holistic strategy that blends digital convenience with human connection. Beyond digital fluency, Gen Z places a high premium on financial wellness and education. Unlike previous generations, they aren't just looking for a place to store their money; they want a partner to help them navigate their financial lives. Research shows that 57% of people aged 18 to 29 seek advice about investing online. However, they are increasingly turning to non-traditional sources, with 67% seeking financial advice from social media channels like TikTok and YouTube. This presents a massive opportunity for banks to step in and become trusted sources by offering embedded budgeting tools, personalized advice, and educational content directly within their apps. Personalization is another critical driver. Having grown up with curated feeds and tailored product recommendations, 73% of Gen Z want their bank to provide more tailored advice on budgeting, spending habits, and paying off debt. Furthermore, values play a significant role in their decision-making. As the most diverse generation, Gen Z values inclusivity and is more likely to support brands that mirror their principles, such as social justice and environmental sustainability. Around 64% of the generation are willing to pay more for sustainable products, a mindset that extends to their banking choices. Despite their digital nature, Gen Z has not completely abandoned physical branches. In fact, 45% wouldn't open a primary account with a bank that didn't have branches, as they provide “peace of mind.” The role of the branch is changing, however. 46% would be more willing to visit a branch if they offered advisory services. This points to a desire for a “phygital” approach, where digital and physical services are seamlessly integrated, allowing customers to start a process online and finish it in-branch with an advisor. To stay relevant, traditional banks must adapt quickly. The challenge from neobanks and fintechs is real, as these agile entities often better meet Gen Z's expectations for low fees, innovative tools, and superior digital experiences. However, traditional banks still hold an edge in trust, with 79% of consumers trusting them more to handle sensitive financial data. The future of banking will be shaped by those institutions that can blend trust and security with the digital innovation, personalization, and wellness focus that Gen Z demands. The future of finance belongs to those who listen, evolve and build with this generation, not just for them.