As digital natives, millennials rely on mobile digital services in many areas of their lives, including banking. The most important functions are payments, savings and investments, according to a European survey by digital banking technology provider CREALOGIX. The survey also found that more than half of the respondents already use offerings from neobanks, suggesting that traditional banks are falling short of expectations when it comes to mobile banking.
The survey of millennials from eight countries across Europe confirmed the preference for digital banking and showed that mobile banking solutions scored particularly well. Convenient, always-on services via a smartphone seemed to be the ideal for millennials who use such services frequently – 72% of respondents said they make payments via their smartphone on a weekly basis.
Ease of secure access via fingerprint or facial recognition and the ability to quickly send money to friends and family were ranked highly on the list of priorities. An overview of the customer’s financial situation as well as the payment of bills are also considered important by the respondents. Less important among the young, on the other hand, are payment in foreign currencies, cashback functions or virtual cards.
Neobanks gaining market share among millennials
55% of millennials have switched to or tried out neobanks. Improved customer experience appears to be the key driver, with convenience a close second as mobile banking applications all for the ability to make payments and access banking services on the move. 74% of respondents also use mobile banking for savings and interest in investments is also high at 82%, but only 49% actually invest in investments via mobile banking. This creates great potential for banks in providing investment advice and it’s clear that traditional banking hasn’t yet been completely overtaken. 45% of respondents are satisfied with the mobile offering of their current bank and their selection of a traditional bank were based on different factors – recommendations by parents, stability and low fees. In addition, 83% percent still rely on a physical debit card and 67% on a credit card. It’s clear that there is an opportunity for traditional banks to catch up to the neobank challengers if they address the digital customer experience.
Johannes Röhrenbach, Group Head of Innovation at CREALOGIX says:
"The study shows that the important and promising target group of Millennials relies on fast and simple solutions for banking, which should be offered with mobile banking."
For the survey, CREALOGIX interviewed 60 people aged 20 to 29 from eight European countries.