Traditional bank stands to gain as it embraces the digital needs of young millennials disrupting the industry
- Millennials look for seamless digital services, a personalised banking experience and a strong performance record from their bank
- HSBC extends its lead by embracing market disruption and providing personalised financial services for a digitally native generation
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A new wave of digital banks and fintech disrupters are revolutionising banking services, but despite being digital natives, millennials still favour traditional banks.
The recent EY Global Consumer Banking Survey revealed that for nine out of 10 Hong Kong millennials, their primary financial relationship is with a traditional bank – seeking seamless digital services, a personalised experience and a provider ready to meet their unique banking needs.
One reason why this demographic continues to turn to major, established banks is trust, pointing to their proven performance over the years.
“As the leading bank in Hong Kong, we maintain a competitive advantage through our best-in-class digital experience,” says Brian Hui, head of customer propositions and marketing, wealth and personal banking at HSBC in Hong Kong. “Among our new-to-banking customers today, one in two are millennials. Renowned for our customer-centricity and innovative suite of solutions, we are well-positioned to become the number one digital bank for millennials.”
“Millennials embrace and are comfortable with disruption – expecting financial providers to use the latest technological tools to consistently provide better services,” he says. “The key challenge is living up to young millennials’ high expectations for products and services, with affordable fees and great customer service.”
Unsurprisingly, young millennials are also looking for an intuitive digital banking experience that is also seamless and personalised. According to the EY survey, 80 per cent of Hong Kong millennials prefer to use an app to manage as many elements of their life as they can.
The net growth of active millennial users on HSBC’s HK Mobile Banking app last year was 90 per cent higher than the previous year, indicating that digital banking is fast becoming the norm for the young generation. The bank says the app’s take-up rate among millennials is testament to its success in harnessing digital innovation to cater to their banking needs. To meet the constantly evolving needs of this demographic, HSBC released almost 200 new features on the app last year, including the first-in-market mobile cheque service, as well as a simplified “lite-mode” version of the app with a clearer and more user-friendly interface.
Meeting millennials’ needs
As Hong Kong’s banking sector responds to the demands of young millennials, HSBC is at the forefront of change – uniquely positioned with its heritage and reputation to leverage customer trust and set the industry standard as a market-leading bank.
Thanks to its culture of embracing disruption, the bank is harnessing the power of data, combined with new technologies such as artificial intelligence (AI) and data analytics, to transform its digital offerings. By doing so, it provides young millennials with a diverse and progressive range of personalised financial services.
To cater to those who conduct so much of their lives online and on the phone, HSBC has created what it calls its Icon strategy to position itself as the bank of choice for young millennials. Within this strategy are four pillars: intelligence, confidence, own and nurture – Icon. The first pillar stands for the intelligent financial insights the bank delivers through Budget, the bank’s customised personal financial management (PFM) tool, which provides insights and recommendations to help its customers set their budget, track their spending habits, develop positive financial habits and manage their finances.
HSBC’s Budget tool now has more than 1.8 million users who have benefited from its hyper-personalised, data-driven insights supported by AI. Recent updates to the feature include the projection of customers’ recurring expenses and estimated payment dates, providing a clearer view of their usable budget.
The “confidence” element in the Icon strategy refers to the bank’s aim of helping customers demystify the process of investing, while building their capabilities through offering skills-based investment education powered by AI. HSBC’s Wealth Coach is a first-in-market online platform offering guidance to HSBC One customers, equipping them with financial planning know-how in an interactive and inspiring way.
Also part of the package, HSBC Trade25 is a commission-free trading platform for amounts up to HK$250,000 per month for young millennials aged between 18 and 25. It is backed by the T25 Academy, a skills-based financial education hub that guides customers through their investment journey, boosting their stock trading knowledge.
To give millennials a taste of investing without the risk of financial loss, HSBC recently launched a seed money acquisition offer as part of the HSBC One “0+0” zero-stress, zero-fee banking campaign. Under the offer, eligible customers who complete investment transactions of at least HK$500 (US$64) using online or mobile banking will be given HK$500 of seed money to begin their investment journey.
The “O” in HSBC’s Icon strategy stands for “own”, referring to the targeted offerings and personalised lifestyle experiences the bank provides. Existing service hubs integrate partnered lifestyle features to help meet the needs of young millennials, such as the Reward+ app to spend and use credit card perks.
Finally, the “N” refers to HSBC’s aim of nurturing financial well-being among young millennials. Initiatives include its Well+ app, which combines market-leading banking and insurance capabilities with gamification, and the MEvolution campaign featuring the popular Hong Kong girl band Collar. The app and branding campaign encourage millennials to equip themselves with financial knowledge and take the first steps to investing using HSBC’s wealth management products.
Getting delivery right
A key aspect of meeting the needs of young millennials is getting digital banking right. HSBC prides itself on being a thought leader and front runner in the digital bank space, with an innovative suite of solutions based on simplicity, personalisation and being digitally first.
“As young millennials enter the workforce, their financial and investment needs are constantly evolving. That’s why we are constantly evolving, too,” Hui says. “By taking an empathetic and proactive approach to their needs and aspirations, it’s clear HSBC is designing solutions that not only address the concerns of young millennials, but also give them a positive outlook on their financial future.
“As a key digital bank of the future, we are poised to meet the changing demands of the industry and will continue to bolster our trust advantage to become the bank of choice for our millennial customers.”
