Why Customers Choose Fintechs or Banks: 2025 Generational Insights

Corporate Insight (CI), a leading provider of competitive intelligence in the financial services sector, has released its latest Fintech Monitor report. Based on a Q1 2025 survey of 972 bank account holders, this research reveals how generational preferences and income levels influence banking choices—offering vital guidance for fintechs and traditional financial institutions seeking to improve customer acquisition and retention.

Insights From the CI Fintech Monitor Report

1. Generational Banking Preferences Are Divided

• Older generations (Boomer+, Gen X) prioritize:
  • No-fee accounts
  • Access to physical branches
  • High-quality customer service
• Younger generations (Millennials, Gen Z) prefer:
  • Peer recommendations
  • Alignment with personal values and social responsibility
  • Digital-first features over physical presence

2. Satisfaction with Digital Interfaces Varies by Age

• 81% of Boomer+ and Gen X users are satisfied with their bank’s digital design
• Only 40% of Gen Z respondents report high satisfaction
• Gen Z also reports lower satisfaction in:
  • Customer service interactions
  • Digital tools for managing spending

3. Incumbent Banks Maintain Strong Customer Loyalty

• 80% of users with only incumbent bank accounts have never considered switching
• Among Boomer+ customers, loyalty is even stronger at 91%
• The top reason for staying: “I like my bank” (reported by 70% of incumbent-only respondents)

Strategic Implications for Financial Institutions

4. For Traditional Banks

• Leverage strong brand loyalty, particularly with older demographics
• Improve digital experience and mobile UX to attract younger users
• Personalize digital customer service to remain competitive

5. For Fintechs

• Double down on social integration, value alignment, and user-driven design
• Build or simulate features of traditional banking—like customer support access
• Create referral and community-driven growth strategies

The 2025 Fintech Monitor report underscores the importance of understanding generational banking behavior. While incumbents hold ground through established trust and loyalty, fintechs continue to capture younger users with innovation and social appeal. The key for both: design demographic-specific strategies that address evolving expectations across digital and physical banking channels.