Solving Gen Z’s Financial Challenges By Blending Human + Tech Solutions

While Generation Z maintains a strong digital-first preference, much about their banking needs benefits from sitting them down with a financial professional. But today that human can be assisted with technology that will bring tomorrow's consumer the best of both approaches.

Each generation brings new hurdles and challenges that banks and credit unions must consider when undergoing structural transformation. But while Millennials somewhat straddled the line between full-digital and legacy services —making innovative transformation a much-less daunting task for financial institutions — Gen Z is primed to cause much more disruption.

Gen Z Ranks Convenience and Timeliness over All Else

Studies have shown that Gen Z consumers are twice as likely to use online-only brands than any preceding generation. These shopping habits are integral for banks and credit unions to take into consideration as well. Furthermore, an overwhelming majority of Gen Z consumers are consistently active on social media and even prefer alternative methods of peer-to-peer payment (e.g. Venmo, Zelle, Cash App, etc.).

Financial institutions need to adopt new, interactive digital services to accommodate this digital preference. Through the use of next-gen technology, institutions already possess the tools to do so.

For example, by integrating artificial intelligence and machine-learning-driven chatbots, institutions will be able to interact with prospective and existing Gen Z clients — providing them with customized services based on each consumer’s self-identified needs. Consumers will be able to open, manage and maintain accounts with more ease than ever. Through the integration of 5G and machine learning capabilities, these services will become increasingly real-time, streamlined and personalized.

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Yet In-Person Experiences Remain Irreplaceable

While banks will certainly need to invest in next-gen digital capabilities to accommodate these Gen Z consumers, there is also an irreplaceable benefit for in-person interaction, and the relationship between a financial institution officer and the consumer.

There is a trust factor that cannot be replaced by digital technology for even the most digital-centric generations of consumers, especially with more complex interactions and account conversations. Face-to-face interaction is key in helping establish said trust in the end-user.

Additionally, that face-time interaction is important for helping explain more complex services and contractual obligations to consumers. They need to fully understand what services best fit their needs, and understand the intricacies that exist within each service package.

Human contact, yes — but not without tech enhancement. Technology can help streamline these more personal interactions as well — and banks and credit unions that successfully integrate such tools will reap the benefits of consumer trust and loyalty. Recent studies have shown that over two-thirds (78%) of Gen Z consumers believe that augmented reality (AR) and virtual reality (VR) will have an overwhelming impact on how we view the world, in just the next five years.

This is where banks should be looking to provide those in-person experiences to a digital audience. Augmented Reality (AR) and Virtual Reality (VR) capabilities can be integrated into online banking processes to help deliver that invaluable in-person experience — without the need to sacrifice convenience or accessibility that comes with online banking.

The role of the in-bank associate is not in danger of being removed outright. It is simply evolving to accommodate a new wave of consumers whose values and priorities differ from traditional generations of the past.

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Serving as a Gen Z Life Coach

AI can be an integral tool for banks to deliver unparalleled experiences at every stage throughout the Gen Z consumer lifecycle — from prospecting to onboarding to goal setting and beyond. For example, potential Gen Z customers can be prospected through hyper-personalized social marketing techniques by utilizing AI to evaluate likes, dislikes, follows and more — finding the right customers and delivering insights into how to best approach.

Once a new customer is secured, “know your customer” technology, driven by application program interfaces and machine learning can help onboard these new customers quickly.

And once they have been onboarded, “best next advice” capabilities can be utilized to deliver actionable short-term and long-term goals. Financial institutions can then use AI, geo-location data, and more to help these customers meet their goals through day-to-day savings — whether it be through a recommended prompt based on spending history and alternative cheaper options in the customer’s daily vicinity, or through recommendations based on over-spending and a removal of wasteful daily tendencies.

These are just a few of the many ways that technology can help provide Gen Z consumers with the convenience, speed and consultation that they require — throughout the entire lifecycle of the bank-to-consumer relationship.

Banks must understand that Gen Z consumers will eventually make or break their success. Though technological adoption has been slowly become more of a priority for these organizations, true disruption and risk-taking innovation is going to be needed to prepare for the next generation of consumers who prefer to operate online and on-the-go.

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