Thursday, June 22, 2017

Study: CUs and Community Banks Face Serious Demographic Challenge

The Financial Brand recently commented that credit unions and community banks face the threat of generational obsolescence.

TA study by FIS examined the age composition of bank and credit union customers.

According to the study, approximately 32 percent of credit union members are millennials -- almost the same as regional banks (34 percent). In comparison, 18 percent of bank customers are millennials. On the other hand, the 50 largest banks have a millennial penetration rate of 42 percent.

While credit unions have roughly the same penetration rate as regional banks, credit unions are losing ground to the largest banks, as large and regional banks scoop up a disproportionately larger share of the millennial generation.

In addition, the FIS study found that community banks and credit unions tend to serve an older population base. Approximately 57 percent of community bank customers and 46 percent of credit union members are over the age of 52.

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