Digital banking: how to tackle the generational gap

In an increasingly competitive digital landscape, financial institutions face challenges regarding onboarding and fraud prevention that are specific to each generation of customers. 

W

hile the younger generations (Millennials and Gen Z) are set to dominate the virtual space in the coming years, banks and fintechs must not forget that their senior clients (Boomers: born approximately between 1945 and 1965) continue to contribute the most accumulated wealth. Therefore, because financial institutions (specially digital banking) have a social responsibility to adapt and cater to all types of profiles, it is imperative that they understand the needs of the older generation. Building trust, facilitating identity verification processes, and protecting them from fraud are fundamental objectives. 

Building trust and preventing cybercrimes like identity theft 

Senior individuals value face-to-face interactions. Only 35% feel comfortable receiving advice through a bot or any artificial intelligence-based resource, compared to 70% of the younger generations (The Financial Brand). Boomers are also the most distrustful of banks, with 37% stating that they do not feel protected against frauds and identity theft. 

Generally, Generation Z is quick to adopt new functionalities and financial technologies. From mobile payments to cryptocurrency investment platforms, they are willing to experiment with the latest innovations. Older individuals, although adaptable, may at times feel overwhelmed by the speed of changes and can be more cautious when embracing new functionalities. 

Contact our identity and fraud experts to prevent customer loss. 

In any case, we should not assume that the older population is unwilling to adopt digital banking tools for their financial activities. The difference lies in how they approach them. Gen Z and Millennials value speed and ease of use, relying on mobile phones. Boomers still prefer personal computers and websites, with a lower tendency to download applications.  

Bringing identity verification to profiles of all ages should be a priority 

Identity verifications with security layers such as document analysis, biometrics, facematch, and life tests ensure reliable and robust processes. Younger individuals are accustomed to taking selfies or capturing their identification documents, whereas senior clients may have less proficiency with mobile devices. Optimizing the mobile experience becomes a crucial goal to enhance conversion rates. 

Fraud knows no generational bounds, but cyberattacks have different entry points depending on demographic groups and their habits. The fact that younger individuals rely more on smartphones for onboarding makes their data more susceptible to compromise through this avenue at higher rates than other generations. 

Digital bank habits that act as a magnet for fraud 

On the other hand, older individuals are less proactive in protecting their information, with constant password recycling and other detrimental habits that facilitate identity theft. Scams through dating apps, technical support frauds, and, in general, social engineering techniques target them. 

In the United States alone, 73,000 people lost nearly 1 billion dollars in romantic scams. Each person lost about $14,000 due to this type of fraud (Idology). Considering that the highest losses occurred in users over 70 years old, it is evident that to avoid reputational and economic losses, banks must focus on protecting senior customers. 

Just as financial institutions cannot expect the same digital experience to serve everyone, they must implement identity verification and fraud prevention strategies that are tailored and inclusive for less digitized individuals. To ensure that technology doesn’t displace entire customer groups and banks can increase clients and revenue, they need to consider several fundamental points: 

• Understanding specific needs 

To prevent older individuals from feeling overwhelmed by technological advances while ensuring their autonomy, banks should collaborate with reliable technology providers. These providers should develop live assistance solutions that leverage the possibilities of digitization without losing personal touch, such as TrustCloud’s Senior Banking.

Request a free demo now and boost customer conversion rates. Additionally, conducting periodic studies and surveys should be a prominent aspect of the sector’s strategies. This approach will facilitate understanding specific demands. 

• Friendly design and adapted service channels 

The interface of digital platforms should be intuitively designed and user-friendly for older adults. This involves using legible text fonts, visual aids, step-by-step guides, and simple navigation options. Moreover, applications and websites should be compatible with assistive technologies like screen readers. Where possible, onboarding and banking management solutions should offer real-time video assistance options by expert agents. 

• Accessible financial education 

Offer tailored financial education programs for older generations addressing the basics of online banking. Provide information on protecting against online scams and maintaining the security of sensitive data. 

• Simplified identity verification 

Biometric analysis via fingerprint or facial recognition should never be a hindrance. Digital banking should develop simple, secure, and understandable verification methods. Passive life tests and background checks minimize friction without compromising security. 

Meeting the expectations of the entire population pyramid by addressing unique challenges through social commitment will positively impact the financial sector’s image and curb economic losses. 

Request personalized guidance from our digital banking specialists.