New data in 2021 has shown how consumers have increasingly adapted to mobile apps – financial apps, in particular – during the COVID-19 pandemic.
Call it common sense, call it expected, but it speaks volumes for those financial institutions slow to innovate in this ever-adapting digital era. According to Global Wireless Solutions’ (GWS) The Pandemic Year in Mobile Apps report, consumers spent an average of four hours on their smartphones during COVID in 2020 – an increase of 10 minutes a day compared to pre-pandemic days. When considering the specific apps used like social media, video, and games, the time used on personal finance or trading mobile apps increased the most at 63 percent during the pandemic year. That growth is led by Gen Z consumers who clocked in their social media sessions at a 102 percent increase in total hours compared to pre-pandemic rates.
“When coronavirus took hold, smartphones became further cemented as a link between isolated consumers and the world at large, thus their usage is increasingly becoming an accurate reflection of human behavior on the whole,” says Dr. Paul Carter, GWS Founder and CEO. “We expect that sustained consumer mobile behavior will have a lasting effect on how consumers will engage with businesses over the long term, and will be a major aspect to establishing what normal looks like now.”
Some key results from the report offer a more comprehensive evaluation of a consumer’s average day as it pertains to interactions through their mobile devices. Even as consumers scrambled to day trading and crypto apps, it was clear financial difficulty was front-and-center for many through the massive growth rate of food stamp mobile apps.
Pandemic drives Gen Z usage of personal finance apps
Considering the statistics stated above, the hours we’re dedicating to our smartphones may seem pretty overbearing. But that’s where consumers find themselves as we continue our efforts to stamp out the public health crisis that is COVID-19 and its variants Delta and now Omicron. Ironically, it’s also helping to push the financial services industry into the next era of digital banking and mobile capabilities.
In a Chase study titled Digital Banking Attitudes, 99 percent of Gen Z and 98 percent of millennials are now using a digital banking app for a diverse array of finance tasks including viewing their account balance, checking credit scores, depositing a check, or even applying for a life event loan with the QCash mobile platform. With Gen Z now entering adulthood and connecting with their primary banking institution, credit unions need to be particularly aware that consumers and members desire easy access and intuitive automation.
Contemporary mobile innovation, along with the way Gen Z manages their finances or purchases products and services, represents a great opportunity for credit unions. According to CU Insight, over half (54 percent) of Gen Z would prefer their credit union release more promotions and incentives to guide them on their digital and mobile experiences. By credit unions going out of their way to enhance the digital experience, Gen Z members would not only appreciate and value the guidance to adaptability, but the effort to help members adjust shines a bright light on your credit union’s purpose, values, and mission.
Financial apps the new social media?
Well, let’s not get THAT carried away, but, research from MasterCard in November 2021 found that Gen Z and millennials are now just as likely to have a financial services app on their phones as social media. Such findings have reflected a change in philosophy during COVID when those coming of age have witnessed their finances become negatively affected.
Considering the economic challenges of the COVID pandemic, it’s hardly surprising that almost half (47 percent) of those who use mobile banking apps check them daily, if not multiple times a day, according to Fintech and Finance News. Those consumers checking the most are in the 25-34 age demographic, with 61 percent checking at least once per day. One can attribute this usage, in part, to an increased confidence in digital banking. Since the pandemic, there has been a concerted decline in use of cash and an increase in all forms of digital payments.
Of those consumers who used digital payments in the last year, 65 percent used their smartphone payments more. In fact, one in four claim they have used new digital payment technologies they would not have considered prior to the pandemic.
“The internet has not really come for financial services before, and now it has,” John Pitts, global head of policy for Plaid, said to Fortune. Pitts said consumer use “means that fintech is now one of the most adopted technologies by U.S. consumers.”
Let’s just hope the credit union movement continues to get the hint.