BOSTON—The youngest generation of members in credit unions isn’t just digital first, it’s “digital fluid,” meaning they move between screens and branches with ease, and they “expect financial partners to keep up,” according to a new report, which found interaction with humans remains favored in at least one area.
What that new reality means is a “new set of pressures for an industry that has historically relied on long-term loyalty,” according to the PYMNTS Intelligence report, “Digital-First Retention Playbook: Winning Gen Z Loyalty at Credit Unions.”
The report, produced in collaboration with Velera, reveals that Gen Z brings :different expectations to their banking relationships,” according to the organizations.
Personalization & Immediacy
“They value personalization, immediacy and authenticity as strongly as they value convenience,” PYMNTS said in releasing the findings. “They also view financial stability through a different lens. Many feel they are navigating a tougher economic landscape than earlier generations, which shapes how they evaluate institutions that want to serve them.
According to PYMNTS, the report makes clear that digital fluency alone is not enough. Gen Z members want guidance that feels relevant and real.
“They want tools that help them manage unpredictable financial lives,” PYMNTS said. “They also want institutions to understand who they are and how they make decisions across platforms that range from mobile apps to TikTok. Their use of artificial intelligence (AI) for financial planning illustrates this shift. It is not just technology adoption. It is an early sign of how consumers may make choices in the next decade.”
The Key Data Points
According to PYMNTS and Velera, key data points in the report include:
- Gen Z is more than twice as likely as other consumers to consider switching credit unions. According to the report, 36% of Gen Z members are thinking about leaving their credit union compared with 14% across all age groups.
Nearly three-quarters of Gen Z feel they face financial challenges other generations do not. The report notes that 72% say they feel less in control of their financial lives. This drives their demand for digital tools that help them manage daily decisions and unexpected expenses.
AI is becoming a routine part of Gen Z planning. The report finds 62% of Gen Z members are open to using AI to explore “what-if” financial scenarios, ranging from macroeconomic shifts to personal income changes.
‘Change in Expectations’
“These metrics point to a larger change in expectations. Gen Z members turn to family, financial institutions and social media creators at nearly equal rates for financial advice,” PYMNTS said. “They often assemble a mix of traditional providers, digital partners and independent sources. In that mix, credit unions do have an advantage.”
PYMNTS further noted the report notes that Gen Z ranks credit unions higher than non-Gen Z consumers do on understanding their needs and on being technologically advanced.“Even as they prefer digital experiences for most transactions, 46% prefer in-person interactions when seeking advice,” the report states. “This creates both opportunity and operational pressure. Credit unions must deliver consistent experiences across every touch point while also offering digital interfaces that match the speed and personalization standards set by consumer technology platforms.”
