Three Ways that Millennials will Shape Financial Services by the Year 2030

Today’s young people in their 20s and early 30s are about to have the highest spending power of any generation.[i] These are the millennials; people who reached adulthood in the early 21st century and are now approaching the height of their careers, buying houses and starting families. They entered their employment in the midst of the financial crisis and are growing up in a world full of environmental, economic and social concerns. Their voice will have a strong impact on the direction in which many industries will need to move and the financial sector is no exception. In order to stay competitive in a crowded market moving towards the year 2030, financial institutions need to ask, “What do millennials really want?”

1)     Digitisation and Artificial Intelligence

Over the past decade, disruptive technology has ushered in huge changes in financial services, with a move to digitisation, mobile banking, online lending and personalised marketing. There is no indication that millennials will be slowing down the rate of technological advancements. Indeed, statistics show that millennials spend an average of 25 hours a week on the internet, with one in three people in this age category making at least one weekly purchase via their computer (as well as many via smartphones)[ii].

Millennials are a generation that expects instant results. Recent years have seen the ability for an individual to make on online purchase in the morning and have it delivered in the evening. Speeding up processes and being convenient will be vital to appealing to the customers of 2030. In addition, clients will want to see an increasingly personalised service. Advances in AI are making this possible, with marketing and products being tailored to fit an individual, rather than grouping people together by demographics such as age, income or career. 

2)     Social responsibility

It is not only convenience that millennials crave. This is a generation with a finely-honed social conscience. They are concerned with environment and with ethics. 69% of millennials want businesses to help customers to be proactive about social issues.[iii] The response to this is already noticeable with initiatives such as Lloyd TSB’s “Helping Britain Prosper” plan.

Investment management and financial advice will also have to change, with greater investment being made into socially responsible funds and environmentally friendly energy sources. Millennials are twice as likely to invest money into a fund that has a positive social impact.[iv]

An important aspect of this is corporate responsibility to customers and wider society. While there will need to be a continued move to digitisation and easy access to accounts, it is likely that a presence on the high street will remain important as flagship stores are used to champion the company’s social awareness. They will also be a visible, physical presence for the company, able to serve customers who do not find it easy to access the business via digitised means. Some banks may turn into social spaces or engage with what is important to local communities – it will be interesting to see where banks and financial institutions take their high street presence over the next decade.

3)     Trust

Millennials are a generation that have seen first hand the devastating impact of the financial crisis that unfolded last decade. In many cases it has impacted their own lives considerably, postponing house purchases, reducing expected income after graduation and even changing life choices such as when to start a family. Inevitably, this has created a mistrust of financial institutions. A survey indicated that such is the dislike of banks that 71% of millennials would prefer to visit the dentist than to listen to advice from their bank[v]. Winning the trust of young people is going to be an integral part of winning their business.

A business that is trusted is seven times more likely to be given personal information by a millennial.[vi]Customer services will play an integral role in earning trust. While AI has a lot of impact in the way that products are planned and marketed, complaints or complex requirements will still largely need to be dealt with by people. Well trained bankers and financial advisors with excellent customer service skills will be vital for building rapport with customers, alleviating any concerns and making clients feel valued and listened to. Specialist recruitment firm, Aston Charles, has a wealth of prospective candidates with qualifications and experience in the financial services sector, who are also well trained in customer facing roles, able to communicate well with customers of all ages.

Finance Services 2030

Millennials are a generation that can’t be ignored. Driving the financial services sector forward is their desire for good service, in a convenient, digitised form; for ethical trading, from organisations that they can trust to have their best interests at heart. Firms that offer these things can stay competitive in a market moving towards the 2030 world of finance services. 

 [i] Jessica Wade. 2017. Statistics every marketer should know about Millennials in 2017. [ONLINE] Available at: https://www.smartinsights.com/digital-marketing-strategy/statistics-every-marketer-should-know-about-millennials-in-2017/. [Accessed 14 September 2018].

[ii] Jessica Wade. 2017. Statistics every marketer should know about Millennials in 2017. [ONLINE] Available at: https://www.smartinsights.com/digital-marketing-strategy/statistics-every-marketer-should-know-about-millennials-in-2017/. [Accessed 14 September 2018].

[iii] Jessica Wade. 2017. Statistics every marketer should know about Millennials in 2017. [ONLINE] Available at: https://www.smartinsights.com/digital-marketing-strategy/statistics-every-marketer-should-know-about-millennials-in-2017/. [Accessed 14 September 2018].

[iv] Jon Holt. 2018. Generation 2030 Will Want More than Just Money From Financial Service Firms. [ONLINE] Available at: https://www.telegraph.co.uk/business/2018/09/02/generation-2030-will-want-just-money-financial-services-firms/. [Accessed 28 September 2018].

[v] Zach Conway. 2017. Why More Millennials Would Rather Visit The Dentist Than Listen To Banks. [ONLINE] Available at: https://www.forbes.com/sites/zachconway/2017/04/19/why-more-millennials-would-rather-visit-the-dentist-than-listen-to-banks/#301eed6172b3. [Accessed 28 September 2018].

[vi] Jessica Wade. 2017. Statistics every marketer should know about Millennials in 2017. [ONLINE] Available at: https://www.smartinsights.com/digital-marketing-strategy/statistics-every-marketer-should-know-about-millennials-in-2017/. [Accessed 14 September 2018].