Banks risk jeopardizing future customer acquisition and retention by failing to recognize the continued importance of factors such as traditional branch networks and parental influence, according to a recent survey. The survey was commissioned to understand youth attitudes and behaviors relating to personal finances, payments and banking of 1400 16-18 year olds from the UK, China and Brazil.
While contemporary banking channels such as mobile are gaining traction among the youth segment, the research, conducted by Survey Shack on behalf of Temenos, a Swiss banking software company, found that traditional banking channels and influences are key drivers among this segment when looking at establishing a new banking relationship.
Respondents from the UK and Brazil cited parental influence as the single biggest driver behind decisions to open a bank account. 37% of Brazilian and 33% of UK respondents stated that they would choose a bank because their parents banked there. All three countries rated branch location as the second biggest driver, with 28% of respondents citing this as the most significant consideration. 90% of respondents globally believe that the branch will serve a purpose for them in the future.
The study also suggests an increasing trend emerging in mobile banking among the next generation, notably in m-commerce. This is particularly evident in China, where 17% of respondents already use their mobile for purchases. This evidences an underlying acceptance for performing sometimes complex transactions using this channel, 40% of respondents globally regularly use their mobile handset for accessing social media, the UK being the highest user at 60%.
“With so much market emphasis being placed on digital and mobile channels, which play a very important part in the future of financial services, banks mustn’t lose sight of the continued importance of traditional channels. This research illustrates that banks need to be responsive to these trends and should consider a balanced attitude to channels, using mobile and other modern channels where appropriate but not underestimating the value of traditional bricks and mortar, even when attracting the younger generation.”, commented Mark Gunning, Global Director, Banking Services, Temenos.