Consumers Are Crowdsourcing Their Financial Services, While Banks Risk Losing Primary Status
Galileo Consumer Banking Report by Datos Insights uncovers the latest consumer banking behaviors and preferences
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The Galileo Consumer Banking Report by Datos Insights reveals that, while traditional banks still claim most of the market, they are at significant risk of losing their role as primary FI, and the customer retention and lifetime value that goes with it.
“To remain competitive, financial institutions can provide services that are digital-first, intelligent and eventually autonomous. Financial institutions that fail to deliver will lose their most valuable customers to their digital competitors,” said
Key takeaways from the report include:
- The concept of using one provider for all financial needs is eroding. Even among satisfied customers, “primary” status doesn’t mean what it used to. Across all age groups, customers are curating their own suite of financial services through multiple providers. Gen Z and younger millennials are leading this diversified strategy: On average, they use more than six financial tools or services. And they are using more than half of these tools outside of their primary FI.
- Personalization is paramount, but many FIs aren’t cutting it. More than a third (37%) of consumers surveyed don’t agree their primary FI makes offers that are tailored to their financial situation, and32% don’t agree that same provider understands their needs or offers personalized service, underscoring the need for banks and credit unions to unlock and use customer intelligence to personalize offers and experiences.
- Customers don’t want to talk to their financial institutions. Instead, they want DIY financial services. 60% of people said they prefer to do everything without human interaction, and 42% of younger millennials have used a virtual assistant to conduct financial activities – more than any other generation.
- Retail banks are missing a prime cross sell opportunity with gig workers. On the surface,gig workers may look like an average consumer, but their needs are decidedly different. Not only do gig workers use a wider variety of financial tools or services, they over-index for specific services that their primary FI may not be offering to them today, such as credit building, budgeting and expense tracking tools. These customers want their financial service providers to recognize and respond to their unique needs in real-time.
“Consumers are making more sophisticated, informed financial choices as the youngest digital natives build their own financial habits,” said
For more information on the research data or to get a copy of the research report, visit galileo-ft.com/lp/the-galileo-consumer-banking-report-by-datos-insights.
About the Galileo Consumer Banking Report
This report is based on a study Datos Insights conducted in Q1 2024 of 2,500 consumers in the
About the Digital and Core Banking Offerings at Galileo
Through API-centric and microservice-based back-end technology, the Cyberbank Core digital banking backbone enables FIs to augment or replace their old core banking systems and dynamically create and deliver tailored financial products and services based on individual customer needs and behaviors. Through its Cyberbank digital services, Galileo empowers financial institutions to deliver seamless and innovative customer-centric banking experiences.
About Datos Insights
Datos Insights delivers the most comprehensive and industry-specific data and advice to the companies trusted to protect and grow the world’s assets, and to the technology and service providers who support them. Staffed by experienced industry executives, researchers, and consultants, we support the world’s most progressive banks, insurers, investment firms, and technology companies through a mix of insights and advisory subscriptions, data services, custom projects and consulting, conferences, and executive councils.
About Galileo Financial Technologies
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