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October 2023 - Retail

Survey reveals half of 25-34-year-olds prefer using embedded financial products and services from their favourite brands rather than banks: A survey of consumers has found that 52% of people aged 23-35-years-old prefer to use embedded finance products and services from their favourite brand as a payment option - over using a traditional bank.

The research by Vodeno and Aion Bank polled over 3,000 consumers from the UK, Belgium and Germany. It also found that 51% of Millennials and Gen Z consumers said that one of the reasons for preferring brands over conventional banks was that the brands are more tailored to their needs. Another reason was that brands offer financial benefits and incentives such as Buy Now, Pay Later (BNPL) and cashback options.

A quarter of respondents polled said that convenience was a key reason why they preferred brands as their favoured choice of payment, with more than a third of 25-34-year-old's polled saying they were offered a good rate for an embedded product. 

BNPL products and other flexible payment options were also more likely to be sought out by 37% of respondents overall due to the cost of living crisis and current economic climate, rising to 50% of those aged 25-34-years-old. Furthermore, half the respondents who are already customers of BNPL providers said that the payment options they offer will encourage their loyalty to these brands.

When asking about brand loyalty and the most important factor to ensure it, competitive prices was the top answer given (44%), followed by a good selection of products (43%). The availability of embedded finance options was also revealed to be important, with 40% saying they will only stay loyal to brands that offer benefits like BNPL, embedded financial services and cashback. Again this figure rose to 50% of 25 to 34 year-olds. 

One in five consumers polled said they shop monthly with their favourite brands, with a further 16% saying they do so every week. The reason for this was found to be in part to do with the favourable payment options available.

Vodeno Chief Revenue Officer Kim Van Esbroeck said:  “The benefits of embedded banking cannot be ignored, and our research offers strong evidence that consumers are not only using these products, but it is also positively influencing their loyalty to BaaS-enabled brands. 

Millennials and Gen Z are charting a new financial course, and increasingly relying on embedded finance products from their favoured brands for their banking needs. 

“Our survey paints a clear picture as to why: convenience, tailored solutions, and accessibility are the cornerstones driving this transformation."

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