What Millennials and Gen Z Really Want from Banks: A Shift Beyond “Just Money”

By 2025, Millennials and Gen Z will make up 62% of the UK’s banking customers, yet a 2024 Deloitte report reveals that 54% feel traditional banks “don’t understand their needs”. Having grown up amid financial crises, gig economies, and crypto booms, these cohorts aren’t just seeking accounts – they demand alignment with their values, tech habits, and life realities. Let’s decode their priorities and how banks are adapting (or failing to).

The Digital-First Mandate: Convenience Isn’t Enough
For digital natives, seamless app experiences are table stakes. A 2023 FCA survey found that 78% of under-35s chose their primary bank based on mobile features, not branch proximity. But usability alone no longer cuts it. As Anne Boden, founder of Starling Bank, observes: “Gen Z doesn’t compare banks to other banks – they compare them to TikTok and Uber”.

Winning apps now blend finance with lifestyle. Revolut’s “Split Bills” feature, used by 43% of its UK users under 30, automatically divides rent/utilities and requests money via WhatsApp. Monzo’s “Pots for Goals” lets users save for everything from festival tickets to IVF, with progress trackers akin to fitness apps. Meanwhile, Chase UK’s “Round-Up Challenges” gamify saving, allowing friends to compete in monthly savings goals.

Sustainability: Banking with a Conscience
Climate anxiety drives financial choices. A 2024 Triodos Bank study showed that 68% of 18-34-year-olds would switch banks for better ESG (Environmental, Social, Governance) credentials. This isn’t just about green loans – it’s transparency in investments.

When TSB disclosed that £1.2 billion of customer deposits were invested in fossil fuels in 2022, it sparked a youth-led #MoveYourMoney campaign. In response, digital banks like Ekko now offer “Carbon Footprint Trackers”, showing emissions per purchase and offsetting them via round-ups. Even legacy banks are pivoting: NatWest’s “Carbon Planner” helps SMEs measure and reduce emissions, appealing to Gen Z entrepreneurs.

Financial Education: Beyond “Boring Webinars”
Having witnessed student loan struggles (the average UK graduate owes £45,000), younger generations crave proactive guidance. However, a 2023 Money Advice Trust report found that 82% find bank-provided financial education “patronising or irrelevant”.

The solution? Bite-sized, social-first content. Chase UK’s TikTok series explaining credit scores through Love Island analogies went viral, gaining 2.1 million views. Plum’s “Financial Therapy” chatbot uses memes and quizzes to address money anxiety. As influencer Myron Jobson, of Interactive Investor, notes: “Gen Z won’t read a 10-page PDF. They want snappy, shareable, and stigma-free advice”.

The Rise of “Financial Hyper-Personalisation”
Generic mortgage ads won’t resonate with a generation where 41% don’t plan to own a home (Resolution Foundation, 2024). Banks must tailor offerings to fragmented lifestyles:

• Freelancers: Monzo’s “Tax Pots” auto-save for freelancers’ tax bills, while Revolut’s “Payday Loans” offer 0% APR cash advances against pending invoices.
• Side Hustlers: Starling’s “Business Toolkit” integrates eBay/Etsy sales tracking, automating expense splits between personal and business accounts.
• Crypto Curious: While wary of volatility, 29% of Gen Z hold crypto (FCA 2023). Apps like Ziglu bridge the gap, letting users earn interest on GBP while dabbling in Bitcoin.

Case Study: Lena, 26, Manchester
Lena, a freelance graphic designer, juggles irregular income and ethical investing. She uses:

• Monzo to separate tax savings and client payments.
• Triodos ISAs to ensure her savings fund renewable projects.
• Ziglu to invest 5% of income in Ethereum.
  “My bank doesn’t just hold money – it aligns with my career and climate values,” she says.

The Trust Gap: Can Banks Catch Up?
Despite innovation, scepticism lingers. A 2024 Edelman Trust Barometer found only 34% of under-35s trust banks to “act in their best interest” – down from 51% in 2019. Scandals like the HSBC climate report greenwashing allegations (2023) deepened this rift.

Rebuilding trust requires radical transparency. Monzo’s “Open Engineering” blog demystifies how systems work, while Starling publishes detailed reports on its carbon footprint and gender pay gaps.

The Bottom Line
As Gen Z economist Arun Advani warns: “Banks clinging to 20th-century models will become relics”. The winners will be those merging tech fluency, ethical clarity, and hyper-relevance. For legacy players, partnerships with fintechs (like Santander’s tie-up with Kabbage) offer a lifeline. For neobanks, the challenge is scaling without losing their agile, user-centric edge.

References Cited:

1. Deloitte (2024). Global Millennial and Gen Z Survey.

2. Financial Conduct Authority (2023). Digital Banking Adoption Trends.

3. Resolution Foundation (2024). UK Housing and Homeownership Report.

4. Triodos Bank (2024). Sustainable Finance Attitudes Study.

5. Edelman (2024). Trust in Financial Services Report.