Advertisers are constantly targeting us to do something. Today, how often has someone tried to sell you on some new product or service? What is the cost of not being able to target your audience? We all know that millennials have a profound effect on how businesses market their products and services, but what about banking? Banking experts like Dan Schatt suggest that not only are millennials changing banking, but they’re also putting their money where their mouths are. Here are some of the ways Millennials are changing the face of banking:
1) Crowd-Sourced Funding
Crowd-Sourced Funding (CSF) is a new form of fundraising that revolutionizes how businesses get capital and allows regular folks like you and me to invest even small amounts in companies we believe in, giving us the ability to participate in the upside. Although there are a few, the main players in this area include “Kickstarter” and “Indiegogo.”
2) Peer to Peer Lending
Peer to Peer Lending is a buzzword that gets thrown around a lot these days. This concept means lending money from one person directly to another without going through a bank.
3) Mobile Banking
As millennials are always on the go, it makes sense that they would want to access their banking information from anywhere at any time. According to a study by TNS Global, nearly 80% of young adults between 18-24 years old said they feel comfortable making financial transactions using their mobile devices, compared with just 61% of the total population in the study.
Millennials are all about their smartphone apps, so it’s no surprise that many banks have created mobile applications for their customers to access their banking information. As millennials continue to make up a larger percentage of bank customers, expect app use to grow.
5) Fintech Start-ups
Finally, fintech start-ups are changing how banks do business by injecting the type of innovative, consumer-friendly thinking that got them where they are today. In 2015 alone, venture capital firms invested $13 billion in fintech companies, which was double the amount in 2014. So, in the end, it’s not only millennials changing banking – but millennials are also fueling these changes.
6) Contactless Payments
Contactless payments are payment methods that allow you to pay with your credit, debit, or prepaid card simply by tapping your card against a reader without having to enter any PINs or sign anything. According to BiometricUpdate.com, “70% of consumers in the UK and US say they would be interested in using biometrics for payments, and a further two-thirds of consumers say they would trust biometrics more than passwords or PINs to secure their data on mobile payment devices.”
The contactless payment industry is growing at an astonishing rate. According to the Nilson Report, worldwide contactless card transactions have quadrupled from 41 million in 2012 to around 162 million in 2013.
While millennials may be on the cutting edge of banking, they’re still subject to many of the same rules and regulations as older generations, such as limitations on how much money they can deposit and withdraw per month if they don’t have a bank account linked to their parents’ or legal guardians’.