Contents
6 minutes read
28 June 2025
Banks that survived the Great Depression, World War II, and multiple financial crises now face their biggest challenge yet: a generation that no longer needs them. At least, not in the way they've continuously operated.
Gen Z walks into banks and asks why everything takes so long. They download apps that let them invest spare change, send money instantly, and buy stocks with no fees. They trust algorithms more than financial advisors and receive investment tips from TikTok creators rather than Wall Street analysts.
Traditional financial institutions are scrambling to keep up. This is Gen Z reshaping the global economic system.
Born between 1997 and 2012, Gen Z represents the first truly digital-native generation. They've never known a world without smartphones, social media, or instant everything. Now, they're bringing this digital-first mindset to money management and disrupting how the world thinks about finance.
The digital money revolution
Gen Z treats money differently than previous generations. They see cash as outdated and prefer digital payments for almost everything. From splitting dinner bills through Venmo to buying coffee with Apple Pay, they've made contactless payments the new normal.
The global finance market has noticed. Digital wallet usage among Gen Z reaches 87%, compared to just 34% among Baby Boomers. This shift forces traditional financial services to adapt or risk losing an entire generation of customers.
Take the example of Zelle, the peer-to-peer payment service. While banks created it to compete with fintech apps, Gen Z users pushed its adoption beyond expectations. In 2023, Zelle processed over $490 billion in payments, primarily driven by young users who sought faster and simpler money transfers.
Investment apps make trading accessible.
Remember when investing required calling a broker or visiting a financial advisor? Gen Z doesn't. They've embraced commission-free trading apps like Robinhood, Webull, and Public, turning investment into a social activity.
These apps gamify trading with colourful interfaces, push notifications, and social features. Users can follow other investors, share portfolios, and celebrate wins together. This approach makes the global finance services industry more accessible to young people who previously felt intimidated by traditional investment firms.
The numbers tell the story. Robinhood gained over 3 million new users in the first quarter of 2021 alone, with the majority being Gen Z traders. They're not just buying traditional stocks either. This generation drives demand for fractional shares, allowing them to own pieces of expensive stocks, such as Tesla or Amazon, with just $1.
Cryptocurrency becomes mainstream
While older generations debated whether Bitcoin was real money, Gen Z started using it. They view cryptocurrency as a natural evolution of digital payments, not a risky experiment.
This generation fuels the crypto boom. Over 40% of Gen Z investors own cryptocurrency, compared to just 25% of millennials and 8% of Gen X. They don't just buy and hold, either. They participate in decentralised finance (DeFi), stake coins for rewards, and even create their own tokens.
The Global Financial Stability Report now includes cryptocurrency as a significant factor, primarily due to its widespread adoption among Gen Z, making it impossible to ignore. Major financial institutions that once dismissed crypto now offer Bitcoin IRAs and crypto trading services to attract young customers.
Social media drives financial decisions.
Gen Z receives financial advice from platforms like TikTok, YouTube, and Instagram rather than traditional financial advisors. Hashtags like #PersonalFinance and #InvestingTips generate millions of views, creating a new category of financial influencers.
This social approach to finance education concerns some experts. The global financial integrity organisation warns about unregulated financial advice on social platforms. However, Gen Z argues that they prefer relatable content from peers over stuffy presentations from traditional financial institutions.
Innovative financial companies adapt to this trend. Fidelity creates TikTok content explaining investment basics. Charles Schwab sponsors YouTube creators who teach portfolio management. Even the World Finance Group acknowledges that social media now influences major financial decisions.
Fintech companies lead innovation.
Traditional banks move slowly. They have legacy systems, complex regulations, and risk-averse cultures. Gen Z doesn't have patience for slow innovation, so they turn to fintech companies that move quickly and break new ground.
Neobanks like Chime, Revolut, and N26 have gained millions of young customers by offering features that traditional banks cannot match. Mobile-first interfaces, instant notifications, savings goals, and spending analytics appeal to users who expect technology to simplify their lives.
The global finance company landscape now includes hundreds of fintech startups targeting Gen Z specifically. These companies raise billions in funding because investors recognise that capturing young customers early creates lifetime value.
Buy now, pay later changes the way we shop.
Gen Z has popularised "buy now, pay later" (BNPL) services, such as Klarna, Afterpay, and Affirm. These services enable users to split purchases into instalments without requiring traditional credit checks or high interest rates.
What started as a way to afford expensive sneakers or concert tickets evolved into a significant disruption of the consumer credit market. BNPL companies process billions in transactions annually, forcing credit card companies to create competing products.
The global finance index now tracks BNPL growth as a key indicator of changing consumer behaviour. Traditional lenders worry about losing market share to companies that make credit decisions in seconds rather than days.
Mobile banking has become the standard.
Gen Z expects banking to happen on their phones, not in branches. They want to open accounts in minutes, transfer money instantly, and get real-time spending insights. Traditional banks that can't deliver these features lose customers to competitors who can.
This mobile-first approach reshapes branch strategies worldwide. Banks are closing physical locations and investing in app development instead. Those that adapt successfully attract young customers. Those that don't become irrelevant.
The global finance news regularly reports bank branch closures and digital transformation initiatives. Gen Z's preferences drive these changes faster than any regulatory requirement could.
The robo-advisor advantage
Traditional financial advisors charge high fees and require minimum investments that many young people can't afford. Robo-advisors solve both problems by using algorithms to manage portfolios at low costs.
Companies like Betterment, Wealthfront, and Acorns attract Gen Z users with automatic investing features. These apps round up spare change from purchases and automatically invest it, making wealth-building effortless.
The global finance journal reports steady growth in robo-advisor assets under management, driven primarily by young investors who prefer automated solutions over human advisors.
Small financial savings lead to big wins for your business!
- Collect from 130+ countries.
- Local USD, GBP, CAD, EUR accounts.
- Free FIRA
Challenges and concerns
This financial disruption isn't without problems. Gen Z's comfort with technology sometimes leads to risky decisions. Day trading apps can encourage gambling-like behaviour. Social media financial advice isn't always accurate. Cryptocurrency investments can be highly volatile.
The Global Finance Institute examines these risks and advocates for improved financial education. They argue that while Gen Z quickly adopts new financial tools, they often fail to understand the underlying risks fully.
Regulatory bodies worldwide struggle to keep pace with the rapid pace of innovation. Rules written for traditional banking don't always apply to fintech companies or cryptocurrency platforms.
What does this mean for the future?
Gen Z will inherit and shape the global financial system for decades to come. Their preferences today become tomorrow's standards. Companies that understand the needs of this generation will thrive; those that don't will struggle to survive.
The shift toward digital-first finance appears permanent. Even post-pandemic, young people continue choosing mobile apps over bank branches, peer-to-peer payments over cash, and robo-advisors over traditional wealth management.
Traditional financial institutions face a choice: adapt to Gen Z preferences or risk becoming obsolete. The most successful companies will combine their experience and stability with the innovation and accessibility that Gen Z demands.
This generation proves that financial services don't have to be complicated, expensive, or intimidating. They want transparency, speed, and control over their money. Companies that deliver these values will win the future of finance.
The global finance magazine predicts that Gen Z's influence will only grow stronger as they earn more money and accumulate wealth. Their expectations will reshape everything from payment processing to retirement planning.
Innovative businesses recognise that Gen Z isn't just adapting to existing financial services – they're creating entirely new ways of thinking about money. The companies that listen and respond to these changes will define the next era of global finance.
Frequently asked questions about Gen Z's approach to finance?
Gen Z faces rising living expenses, significant student and credit card debt, and finds it difficult to save or invest regularly. Many experience financial anxiety due to unpredictable job markets and the pressure to keep up with peers.
