Financial Services professionals are increasingly confronted with the challenge of designing financial systems for the youth segment, more specifically Gen Z. Yet, most of them start in the wrong place. They approach Gen Z as a marketing problem rather than a product design problem. The result is often a superficial repackaging of traditional banking products: brighter colours, social media campaigns, cashback offers, influencer endorsements, and youth-centric branding, while the underlying financial experience remains fundamentally unchanged.
A recent BCG Snapchat Study estimates that in an emerging market like India, Gen Z already accounts for 26% of the population and is expected to drive nearly half of all consumer spending over the next decade. Yet, despite their growing economic significance, why are so few financial institutions designing products specifically for them from the ground up? Is it a lack of understanding of Gen Z's financial expectations? Or are legacy systems, and the mindsets built around them, holding the industry back?
I think it is more of the former. While legacy technology is part of the problem, recent fintech partnerships demonstrate that institutions willing to rethink the customer experience can often innovate despite those constraints.
Let us examine in greater detail how Gen Z’s relationship with money differs from previous generations.
Financial decisions are embedded in the digital lifestyle
For many Gen Z consumers, money is less an end in itself than an enabler of convenience and procurer of experiences. Their financial app should blend with their lifestyle rather than the other way around. Pay for a burger, buy the underground ticket, renew their OTT subscription, browse for an outfit for an upcoming soiree. All on the go. In the fewest taps. In the same ecosystem. That is what Gen Z needs.
Gen Z are digital natives. They not only compare financial apps across Banks, but also with the experiences delivered by platforms providing ride-hailing, streaming, food delivery, and e-commerce applications. Most financial apps are satisfied with being an evolutionary upgrade over the first-generation remote services offered over a laptop. There is thus a wide gap between the expectations of a Gen Z user and what is on offer.
Honesty and transparency are the bedrock
They are value seekers and expect honesty and transparency from their financial brands. Jargon-filled long-form terms and conditions, opaque fee structure, complex product write-ups, convoluted process flows. They all create friction that older customers may tolerate but younger users often reject. They may be young in years but do not want to be patronised by big brands and expect to be treated fairly. The fear of the unknown is a deterrent to adoption.
Trust is based on unbiased guidance
While they have access to unprecedented amounts of information, they need unbiased guidance, not intended to make a sale, to help them make sense of it. Better still, curated learning modules which help them take control of their financial future. An altruistic approach is a strong trust builder.
The need for financial products is unlike the past
An increasing proportion of Gen Z no longer fits the traditional template of a steady long-term job with a fixed income anymore. A Gen Z user may be earning through freelancing, content creation, gig work, or a side hustle long before entering traditional salaried employment. A financial platform that caters to the set of differentiated requirements that such varied income streams present shall resonate strongly with them.
Unconstrained by any past baggage, Gen Z users are willing to experiment with newer brands that are more tailored to their requirements. This trend is visible across a number of categories like food, fashion, travel etc. Financial products are no different. This is what explains the rise of digital-only Banks across the world, even in geographies which are highly “traditionally” banked. The consumer of today does not see the presence of a physical branch as a necessity, completely upending the traditional banking model.
These behavioural differences are not merely interesting consumer insights. They fundamentally change how financial products should be designed. What many providers fail to appreciate is that Gen Z's primary problem is often not banking itself. Their challenges include:
Products that address these needs can create genuine engagement. For example:
There is also a deeper mistake institutions make. They assume Gen Z is a customer segment. In reality, it is almost a distinct financial behaviour model. Traditional banking was designed around salary credits, monthly budgeting cycles, branch relationships, and long-term product ownership. Gen Z often operates around instant payments, digital identities, creator economies, subscription services, and continuous engagement.
The winners in this segment are therefore unlikely to be those that create the best "youth account." They will be those that build platforms around the broader financial and lifestyle journeys of young consumers.
They need a financial operating system that helps them earn, spend, save, borrow, learn, and aspire within a digital-first lifestyle.
That is where most institutions stop at the surface level, and where the real opportunity lies. Interestingly, this is particularly relevant in countries like India, Indonesia, Vietnam, and other emerging economies where the demographic dividend creates a large population entering the formal financial system for the first time. The institutions that design for behaviour rather than age are likely to capture disproportionate long-term value.
(Maneesh Srivastava is the Co-founder & CEO of Paydoh, a fintech operating out of Mumbai, India. The views expressed by the author are personal.)
