Could Amazon, Facebook, or Google be our banks of the future?
Well, according to a new study from LivePerson, that could be the case.
Nearly half of Gen Z respondents (43.2 percent) believe that big technology companies like Amazon, Facebook, and Google could replace banks in the future. If given the choice, 28.6 percent of Gen Z and Millennials surveyed would choose Amazon or Google as their bank over their current bank.
Younger banking customers, and those poised to become customers in the immediate future want innovation and convenience, the study notes. Almost one-fifth (18 percent) of younger consumers and 12.3 percent of all consumers would select Amazon as their bank of choice over their current bank. The reason for this choice, according to respondents, is trust in Amazon (51.5 percent) and Amazon’s perceived superior technology and convenience (43.6 percent).
Those who chose Google as their hypothetical bank cited better technology and convenience as their top reason for switching (73 percent).
Respondents aged 55 and older prefer going to a physical branch. A majority (57 percent) stated they would rather go into the branch, compared to 30.5 percent who would prefer their bank’s website and 10.4 percent who would prefer to use the bank’s app.
In August 2017, LivePerson commissioned an online survey of more than 1,000 U.S. consumers aged 18 and older to assess their banking habits and preferences. Respondents were asked a series of questions about how they handle their banking and what they believe the future of banking will look like.
“The future of banking is all about digital convenience,” the study says. “When comparing the preferences of the youngest generations to the oldest, there is a clear dividing line, which is their strong preference for the convenience of digital platforms. As with each generation before it, the younger generations’ preferences will become mainstream as they grow older.”
Here are some other key study takeaways:
More than one-quarter (27.8 percent) of Gen Z and Millennial respondents indicated they do not think banks will have physical branches in 10 years
Similarly, 43 percent of all respondents said they would consider using a bank that only exists digitally. This was even higher among millennials (53 percent) and Gen Z (49.4 percent)
12 percent of millennials said they’d prefer to use a bank that only existed digitally and didn’t have any branch locations
56 percent of Millennials indicated there are some processes they’d prefer to handle without having to speak with a human
These processes include changing address information (43.5 percent) and replacing a lost or stolen credit card (33.3 percent), according to Millennials. Some (13.6 percent) would even prefer to discuss their finances with a bot instead of a human
More than a third (36 percent) of Gen Z and Millennials reported they prefer to bank through their bank’s mobile app to visiting a branch (33.6 percent) or going to the bank’s website (25.4 percent)
Across all ages surveyed, half of the respondents prefer to do their banking online or in-app (50.1 percent) vs. going to a branch, and a mere 2.6 percent of consumers prefer to do their banking over the phone.