With Gen Z projected to make up 31% of the global workforce by 2030 and wielding a purchasing power expected to reach $12 trillion in the next five years, financial institutions are rapidly adapting to meet the expectations of this digital-first generation.
According to PYMNTS, 54% of Gen Z customers favor non-traditional financial providers. Their demand for real-time services, values-driven brands, and digital engagement has pushed both neobanks and traditional banks to rethink their approach.
Gavin Michael, CEO of Varo Bank, emphasized that Gen Z values flexibility and transparency. Products like Varo Advance and AI-driven credit lines are tailored to meet their cash flow-driven financial habits rather than relying on traditional credit scores.
At U.S. Bank, EVP Arijit Roy noted a shift in marketing strategies. With Gen Z gravitating towards platforms like Instagram and YouTube Shorts, the bank introduced personalized communication and bundled services, such as the “Bank Smartly” initiative, which simplifies banking by combining multiple financial products into one seamless package.
A simple rewards redemption prompt at checkout has significantly improved engagement, Roy added, showing that Gen Z craves instant validation and interaction.
Meanwhile, Travis Credit Union is working to change perceptions about credit unions. SVP Grady Bond explained that many Gen Z users are unaware of the benefits credit unions offer. By promoting digital capabilities and low-fee structures, the union is bridging the awareness gap while leveraging local presence for omnichannel engagement.
SoFi has taken the lead in democratizing investment. EVP Kelli Keough revealed that the platform offers access to private shares and alternative investments, coupled with digital tools and financial education. “They expect the same products wealthy investors get—just digitally,” she said.
Greenlight, a platform focused on financial literacy for youth, has tapped into Gen Z through gamified learning and chores-based rewards. Chief Innovation Officer Chris Halaschek pointed out, “Financial trust is passed down. Win the parents, and you win the kids.”
Banks are also evolving their acquisition and retention strategies. At SoFi, direct deposit remains a powerful engagement tool, with bundled services deepening customer relationships. U.S. Bank’s real-time reward redemption has reshaped spending behaviors, while Varo uses continuous underwriting and machine learning to tailor its offerings dynamically.
Surprisingly, even traditional methods like direct mail still resonate with Gen Z, offering a sense of personalization amid digital clutter.
Panelists also discussed the KPIs driving their Gen Z efforts. Greenlight tracks tasks and age-specific behavior. Travis Credit Union measures the Gen Z ratio among new members. Varo monitors product adoption and progression, while SoFi focuses on unaided brand awareness through high-visibility campaigns. U.S. Bank tracks digital engagement and financial stability indicators.
The ultimate goal, as Michael from Varo puts it, is to deepen customer engagement throughout their financial journey. Keough echoed the sentiment, stressing the importance of guiding users to their next financial milestone.
Bond emphasized trust over ROI, while Halaschek shared that Greenlight facilitates smooth transitions as users mature. Roy concluded by underlining the importance of evolving alongside Gen Z to remain relevant.
As Keough aptly summarized, “Gen Z writes the rules. Our job is to help them achieve their ambitions.”
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News Source: Pymnts.com
