Banks have been the primary method of saving and exchanging currency for centuries but since the world's economy is collapsing the dynamics changing quickly.
For anyone that came of age during the financial crisis, it's impossible to forget the long list of banks that needed bailouts.
During the recession, most of the millennials were studying in college with a massive student loan or entering the market where there were no proper jobs. Therefore most of the people from an earlier generation lost their faith from traditional banking systems.
Well, a major population of millennials has a great level of disagreement with big banks even after recovering from the financial crisis. According to a report by the World Bank, almost 50 percent of millennials believe that due to the recession, the way they perceive banks has changed.
They have seen how reckless, greedy, and corrupt the banking system which caused a major downfall to the economy and they faced a huge problem in finding a problem or building wealth. And not many of us indeed want to have a conversationwith banks.
The only reason why the current generation doesn't like the traditional banking system is the bank themselves.
Since the start of this 21st century, traditional banks have suffered billions in fines and rectify for customer exploitation. Recently there have been many bank frauds that have shocked the Indian banking system like:
Neerav Modi Bank scam
Bank Scam by Vijay Mallya
Allahabad Bank Scam
Rotomac Pen Scam
R P Info Systems Bank Scam
Simbhaoli Sugar Mills Bank Scam
Bank of India:- Rs 754.77 crore
Indian Overseas Bank:- Rs 771.07 crore
Union Bank of India:- Rs 458.95 crore
Bank of Baroda:- Rs 456.53 crore
Allahabad Bank:- Rs. 330.68 crore
Oriental Bank of Commerce:- Rs97.47 crore
Bank of Maharashtra: Rs 49.82 crore
Therefore, millennials have developed awareness towards thedomination, organization, and manipulation of big banks in the financialsector. Customers are demanding the end of the dominance of huge companies andask for more transparency, honest behavior, and sensitivity.
Well, most of the banks are getting on track and responding it to the demand but it seems too late as the generation has lost all trust in the Indian financial institution.
The advancement in technology is disrupting every sector in the world and changing the way we operate in those sectors. The same can be said for the financial industry as numerous tech innovations are coming every year.
All the new applications and services that we can handle through our smartphones are going to destroy the vertically integrated banking model by making financial institutions and customers together and will renew trust by being transparent.
These big banks are unable to make these drastic changes and execute new technologies quickly therefore, the fintech companies are driving digital advancements in the banking sector.
According to research, investments in global fintech start-ups are growing well above $40 billion with a compound growth of over 42 percent from the last five years. Unsurprisingly, millennial preferences are among the primary motivators of fintech growth.
This fintech is providing the current generation what they wanted that is, an instant and personalized service that can easily go with our everyday use of technology like smartphones and laptops.
Additionally, because these new financial companies are effectively familiar with millennial trends and they can make banking more comprehensible and exhilarating for a new generation.
Financial start-ups are offering transparency in the financial sector which was very much needed and giving more control over services like dependable customer service and 24-hour immediate access to account reports.
Many banks have already made their move toward this fintech revolution and many new companies are maintaining full transparency which is important and it is disrupting the traditional financial sector.