How to Win Millennial and Gen Z Customers

Jim Marous (0:00)

Younger consumers are increasingly banking elsewhere, but the game isn't lost yet. According to JD. Power's 2026 US. Millennial and Gen Z Checking Satisfaction Study, millennials and Gen Z now open 67% of all new primary checking accounts, and most of those accounts are going to the megabanks, online banks and fintechs. These are customers we're all pursuing to replace the baby boomers most of our institutions rely on today. The surprising part to me is who's fallen behind. Increasingly, it's mid-sized banks, community banks and credit unions. My son's banking relationship shows why this segment deserves a closer look. His first checking account was at the bank where I banked, but he never visited the branch one time after opening his account. A credit union won his mortgage, and he opened a required secondary checking account there. Yet, most of his paycheck still goes somewhere else, which I'll give you some information about in a minute. In the JD. Power data, mid-sized banks, community banks and credit unions together hold 26% of primary checking account relationships among millennials and Gen Z. But their share of new accounts is only 21%.

If that gap persists, their share of these customers will continue to slip. Alternatively, online banks and fintechs are winning a larger share of new accounts than they hold today.

And national banks are much closer to keeping pace with their legacy buying. An ongoing concern is that fintech and neobank customers in both generations rate their checking accounts higher than national and regional bank customers do. And they are more likely to recommend these companies to other people. The biggest satisfaction gap lies in three areas. How fair the fees feel, whether the balance updates fast enough, and whether the account actually helps them progress with their money. For a community banker crediting union, that raises a practical question. What would make someone choose me for more of their financial life? It's easy to look at a younger customer's balance and assume a bigger relationship will come later. But many millennials are already in their 30s and early 40s managing mortgages and family finances. And the balance they keep with you may tell you very little about the business they do elsewhere. We also tend to assume that winning the mortgage will bring the rest of the relationship along. My son's experience says otherwise. As I mentioned, his first bank was a top 10 bank he never visited. Instead, he deposits $200 from every paycheck into that account so automatic payments don't overdraw it. The rest of his paycheck goes to his mortgage and to Chase. When he was getting ready to buy his wife's engagement ring, he used AI and search tools to find the card with the best rewards and a great credit line, while also trying to reduce the chance of being denied. Chase card came up. He got the card and soon after that, his direct deposit followed. That said, most of his everyday spending runs through Venmo. That matters because primacy is sometimes decided as much by where the cash transaction actually happens as by where the direct deposit lands.

Then there's his mortgage from a crediting known for exceptional rates for first time home buyers. He had to open a check in count there to get the loan and each pay period, he transfers just enough to cover his payment. That's his entire relationship.

Three check accounts for three different purposes with much of his everyday transactions running through the Chase credit card or Venmo. My friend, generational researcher Jason Dorsey led new research for Alkami on exactly this, and he put it simply, a primary banking relationship is no longer a promise of exclusivity. I've linked that Alkami research in the description below if you want to compare it to what your own customers are doing. So, could customers like my son get more value from an account at your organization? One JD. Power finding suggests a place to start. Across 14 of the study's 32 measures, simply knowing a feature was available was associated with higher satisfaction, even when the customer hadn't used it. And the feature with the biggest impact, like credit building, budgeting tools, and retailer rewards are the ones the fewest customers know about. Think about someone transferring just enough money into their account at your organization to cover more years. Do they know what else their account could help them do? Before building another feature, I'd find out whether customers understand the useful ones you already offer. JD. Power also concluded that most of these gaps come down to design and policy choices. Huntington shows a traditional institution can win here. It beat the regional bank average with millennials by 48 points, with JD. Power credits largely to taking the fear out of overdrafts. So here are six specific ways I'd look for growth.