Jan. 13, 2017
Nontraditional and alternative providers pose a potential threat to the future of millennial relationships with traditional financial institutions, according to results from a recent survey by Phoenix Synergistics.
According to report, Millennials, Gen X, and Baby Boomers: Financial Insights, all three groups widely hold checking accounts, but the numbers drop somewhat among millennials.
Approximately 13 percent of millennial checking account holders have moved or switched their main checking account within the past two years. By comparison, less than 10 percent of Gen Xers and baby boomers have done so.
The top reasons for switching providers included a desire for features such as surcharge-free ATMs and free checking; a life-changing event such as moving or getting married; and the demand for better customer service.
Millennials also expressed the greatest likelihood of opening a financial account with nontraditional or even nonfinancial providers, many of which have the capability of addressing some of these concerns.
Providers who received the greatest number mentions included PayPal and Amazon, followed by Walmart, Google, Apple and Facebook.
"Traditional providers should take this threat very seriously and begin addressing it in terms of pricing and promoting relationship benefits to their millennial customer base," Phoenix Synergistics CEO William H. McCracken said in the release. "Otherwise, financial provider share could be dramatically altered in the near future."
For the study Millennials, Gen X, and Baby Boomers: Financial Insights,Phoenix Synergistics conducted 1,000 online interviews with a minimum of 300 participants in each of the following age ranges: millennials, 18–35; Gen X, 36–51; and Baby Boomers, 52–70.