Banks need a new playbook to win gen-z customers

Pandey believes the biggest challenge for banks is not technology but understanding how younger consumers interact with money. Unlike previous generations, Gen Z’s first financial experiences often come through digital platforms offering cashback, instant payments and seamless user experiences rather than traditional bank branches.

For most banks preparing for Gen Z, the focus remains on surface-level fixes rather than the underlying behavioural shift. “My first financial decision wasn’t opening a savings account, it was choosing which app gave me cashback,” Pandey recalled a 23-year-old customer telling him, highlighting how younger users evaluate banks against the digital experiences they already know.

According to Pandey, banks are increasingly becoming places where money is stored rather than where financial decisions are made. “If a product needs explanation, it is already losing,” he said, stressing that banking services must become simpler and more intuitive.

He noted that Gen Z manages money as a continuous flow instead of separating it into categories such as savings and spending. Subscription payments, gaming expenses and irregular income are all treated as part of a single financial journey. However, many banks still design products around fixed categories, creating a disconnect with younger users.

Pandey said banking apps should provide real-time insights, such as identifying duplicate subscriptions, alerting users about price increases and warning them about low balances before upcoming payments.

He also believes trust in banks is no longer automatic. Instead, younger consumers judge financial institutions based on the quality of their digital experience. Trust, in his view, is now inferred from the product experience rather than granted upfront. He added that banking communication often focuses on long-term financial planning, while Gen Z is more concerned with immediate challenges such as rent and day-to-day expenses.

Pandey also argued that Gen Z no longer relies on a single financial institution. Instead, they use different platforms for payments, investing, salary accounts and credit. “They will be the ones that become genuinely indispensable at high-intent moments, borrowing, investing, managing risk,” he said, adding that full ownership of the customer journey is no longer a realistic or necessary objective for banks.