How Millennials Are Helping Drive FinTech Adoption

Once upon a time, people actually needed to visit their local bank branches in order to take out money, make a deposit, or get a loan. As International Business Times notes, this meant that customers were often making their banking decisions based on how much they liked the people they interacted with and might even open a new account or take out a loan for that reason. While some may miss the personal aspect of banking, a younger generation is embracing technology that makes banking more convenient and powerful.

Originally known as Generation Y, Millennials are loosely defined as adults who are between 18 and 34 right now. Since many of them have grown up with the Internet, there’s a general consensus that they are more tech savvy than previous generations. As a result Millennials are at the forefront of FinTech and other banking technologies.

According to IBT over 33% of the current workforce is comprised of Millennials with over a quarter of them making more than $75,000 annually. As big as their impact on the economy and banking at large is now, it’s only going to grow over time. WalletHub CEO Odysseas Papadimitriou explains this, saying, “Millennials are starting to buy homes and save for retirement and college funding. It’s going to have a huge impact in 10 years and in 20 years the banking landscape will be completely transformed.”

The first big change is the adoption of mobile banking. Last year more than half of all smartphone users reported engaging in mobile banking — a rise of nearly 10 points over three years. IBT notes that one of the reasons the technology hasn’t become even more prevalent is concerns over security that Millennials take just as seriously as other age groups.

Other non-traditional forms of banking have also caught on with the younger generation including peer to peer payments such as Venmo, saving and investment apps such as Mint and Robinhood, and even online-only banking. IBT reports that Simple, a bank that operates strictly on the internet, has experienced a 179% increase in deposits over the past two years. CNN Money also recently reported that the investment mobile app Acorns has helped Millennials save over $25 million so far.

We are no longer in an age where the average American knows their local banker. FinTech startups are changing the way consumers handle their money and the Millennial generation has shown their willingness to embrace these innovations. As Millennials mature and an even more tech savvy generation comes of age, it’s adapt or die time for the banking industry and the right time to be in the FinTech space.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Zilch Adds $50 Million to Latest Funding Round

Despite some reversals of fortune in FinTech as of late, a growing U.K.-based firm has announced an additional investment. Recently, Zilch announced that it had extended its round with an additional $50 million in funding. The added funds bring their Series C to a total of $160 million, while the company has now raised $460 million in equity and debt to date. The extended funding round comes on the heels...

Top 10 Personal Finance Articles of the Month — June 2022 

It’s time again for one of my favorite features here on Dyer News: a look at the top 10 personal finance articles of the month. To start, we'll take another look at financial independence and freedom. Then, with the housing market going a bit crazy lately, we'll feature a pair of articles on home buying. Lastly, we'll cover tips for one-income households, finance after death, fighting inflation, and more. As...

Bilt Rewards Launches Travel Portal with Benefits for Cardholders

Last year, the startup Bilt made a splash when it announced a new service that would reward users for paying their rent. That premise was then expanded upon with the launch of the Bilt Mastercard, which is issued by Wells Fargo. Now, continuing to capitalize on both the hype of their product and the demand for travel, Bilt has debuted another new offering for customers. This week, Bilt Rewards announced...