The question "Why does the hull of the bank start to sway while the financial ship turns slowly?" may not be a common problem in our daily discussions, but it is a phenomenon worth pondering.
In today's society, we find two strange phenomena: on the one hand, more and more wealthy people are choosing to stay away from traditional deposit methods, and on the other hand, the younger generation seems to be gradually moving away from traditional banks.
How did all this happen, and how do we understand the underlying reasons behind this?
1. Why don't the rich stop saving money?
Why do the rich no longer save money? This question has been widely discussed in the contemporary financial field. One of the core reasons is that with the diversification of the global economy and the maturity of financial markets, traditional bank deposits are no longer the only, or even the best, way for high-net-worth individuals to manage their wealth.
Wealthy people are increasingly inclined to invest their money in the stock market, the real estate market, private equity funds, and even riskier start-ups with great potential for returns. These investment channels often deliver a much higher rate of return than bank deposits. For the wealthy, the increase in capital has become their primary consideration.
The impact of globalization cannot be ignored either. In today's increasingly integrated global financial markets, the wealthy are more inclined to diversify their risks through diversified portfolios and seek investment opportunities across borders. This broadening of their global perspective has made them more flexible and broad in their investment decisions.
The development of fintech has also driven this change. Modern financial tools and platforms provide the wealthy with more convenient and efficient ways to manage their assets, such as digital asset management and automated investment advisory services, which are more personalized and efficient than traditional bank deposits.
The fact that the wealthy no longer save reflects their desire to increase their assets and their trust in emerging financial instruments and markets. This trend has not only affected the development of the banking industry, but also posed new challenges for individual asset management and investment decisions.
2. The alienation of young people
The alienation of young people from traditional banks is a noteworthy social phenomenon that reveals the changes and generational differences between the demand and supply of financial services.
1. The pursuit of digitalization and convenience
We cannot ignore the impact of the digital age on young people's behaviour. In an age characterized by instant gratification, mobile-first, young people are Xi using their smartphones to manage their lives, including financial matters.
They prefer digital banking and fintech applications that offer instant services, user-friendly interfaces, and ease of use. At the same time, traditional banks often struggle to match these digital platforms in terms of speed, flexibility, and user experience.
2. Trust and the impact of the financial crisis
Next, the issue of trust must be considered. Over the past few decades, a number of global financial crises have had a profound impact on the psychology of young people.
Many young people have witnessed the collapse of financial institutions, the loss of depositors, and the instability of the economy, experiences that have reduced their trust in the traditional banking system. They tend to look for ways to provide financial services that seem more transparent and closer to their values.
3. Social Responsibility and Ethical Finance
In addition, today's younger generation has higher expectations for corporate social responsibility and ethical standards. They tend to support institutions that are committed to sustainability, social justice, and ethical practices. For traditional banks that do not perform well on environmental, social governance (ESG), young people may show a marked sense of alienation.
4. The need for personalized service
Young people are also looking for more personalized financial services. They expect banks to offer customized products and services that meet their specific lifestyles and needs. This includes not only financial products, but also related consulting and educational services. However, many traditional banks have not fully kept up with the expectations of younger customers in this regard.
5. The attractiveness of technology and innovation
Finally, technological innovation is extremely attractive to the younger generation. They are open to emerging technologies such as blockchain, cryptocurrencies, and artificial intelligence, and are willing to experiment with new financial products and services offered through these technologies.
In contrast, traditional banks tend to be slower to innovate at a slower pace, struggling to meet young people's desire for novelty and high-tech experiences.
The alienation of young people from traditional banks stems from a number of factors: the need for convenient digital services, the decline in trust in the banking system, the high demand for social responsibility and ethical behavior, the desire for personalized financial services, and a strong interest in technological innovation.
The combination of these factors has contributed to a clear shift in the financial behaviour and choices of the younger generation. If the banking industry is to re-engage younger customers, it must respond and adjust to these changes.
3. The self-innovation of traditional banks
In the face of growing market challenges and changing customer needs, traditional banks are actively exploring ways to reinvent themselves. This transformation involves not only the renewal of technology, but also the in-depth adjustment of service concepts and business models.
Digital transformation is an important aspect of banks' self-innovation. Many banks are introducing advanced technologies such as artificial intelligence, big data analytics, blockchain, and cloud computing to improve operational efficiency and customer service quality.
For example, personalized financial advice through artificial intelligence, or the use of big data analytics to better understand customer needs and behavior patterns. In addition, the launch of digital wallets and mobile banking apps is also a reflection of the rapid response to customer needs.
In addition to technological innovation, improving the customer experience is also key to banks' self-innovation. Banks are striving to provide more convenient and user-friendly services, such as by streamlining the loan approval process, offering more flexible service hours, or innovating the way customers interact.
At the same time, some banks are starting to focus on improving the experience of offline branches, such as attracting younger customers through modern design and offering non-traditional banking services such as café-style service areas.
Against the backdrop of a global focus on sustainable development, banks are also trying to demonstrate their social responsibility.
Through green financial products, financing to support environmentally friendly projects, or implementing energy conservation and emission reduction measures in their internal operations, banks are gradually building a positive social image to attract customers with high CSR requirements, especially the younger generation.
Through these self-innovation measures, traditional banks are not only improving their competitiveness, but also gradually adapting to the rapidly changing market environment.
This transformation is both a response to existing challenges and a grasp of future opportunities. Through these efforts, the bank hopes to better serve customers of different ages and backgrounds, especially young people with new expectations and requirements for financial services.
epilogue
These two major challenges faced by banks are actually a reflection of the changing times. Adapting to this change is both a challenge and an opportunity.
The future of banking will depend on how they understand and adapt to the needs and expectations of this generation. For us as observers and participants, understanding this phenomenon may help us better grasp the financial pulse of individuals and society.