Study: 14% of young consumers favor credit unions

When it comes to the debate between banking and credit unions (CU), it is clear where the loyalty of young consumers lies.

A PYMNTS survey found that younger consumers show a stronger preference for national banks than for UCs.

However, there is a silver lining here for UCs, as more 18-24 year old consumers use UCs than 24-34 and 35-44 year olds, meaning UCs have the ability to see a comeback with the younger generation of banking customers.

The survey showed that the greatest preference for UCs is still found among baby boomers and older people, with 60% of people aged 65 and over saying they are members of a UC.

Additionally, 54% of respondents between 55 and 64 and 35% of those between 45 and 54 are members of the CU, while only 19% of consumers between 35 and 44 and 14% of those between 25 and 34-year-old said they turn to UC for their banking.

While 36% of consumers aged 18-24 choose national banks for their financial services, 26% say they belong to UCs. UCs have a downside here, in that they tend to be much less visible than their competitors.

Still, the significantly higher interest from the younger generation of banking customers suggests that UCs have a chance to attract them if they can offer the digital tools that many have come to expect, coupled with the member-centric mission that has long been a trademark of CU.

PYMNTS research found that 23% of UC members would consider changing their primary financial institution (FI) for innovative digital banking products. This included 38% of UC members who would switch to access to mobile check deposit, 38% who said they would switch to access to digital cards that can be issued directly to their digital wallets, 35% for peer-to-peer (P2P) payments and an additional 35% for cardless cash withdrawals.

To learn more about what’s going on in the world of UC, download the Credit Union Tracker, a PYMNTS and PSCU collaboration.

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Leslie M. Gill