The first half of 2022 was a wild ride to be sure. But the fact is, after major shocks to the global economy, and managing (or not) the initial bumps and breaks that come along with shifting from a slow-growth, low-interest rate environment to a high-growth, high-inflation economy after 14 years, the deeper issues take time to arise.

It was interesting that in late March, as we started into this “next normal” phase, WSJ reported that due to supply chain issues and rising inflation in the grocery stores, Gen Z and Millennials were abandoning brand loyalty for price advantage.

Remember brand loyalty was a concept that hit Madison Avenue post-WWII and has been a key driver of most major brands for the decades since then.

But these new generations, digitally native, weighed down by student debt, the constant reminder of climate change, a peripatetic job market where most have “side gigs” and other unique challenges, have been forced to rethink the old and established ways of thinking about consumerism.

And in that context, banking has been a major point of consideration. 

Many will say that digital banking was a long evolving inevitability. But there is always a point of inflection with the stress that comes along with long slow change. Tectonic plates continually shift, but sometimes they pop and we end up with massive earthquakes.

Banking is now the epicenter of one of those earthquakes.

And as you can see, different banks and credit unions are dealing with it in different ways. Some are hunkering down and waiting for the first wave to pass. Some are merging to expand their footprint and expand their balance sheets. Others are looking for opportunities in digital banking solutions to create better value for their customers and keep those primary accounts that mean more than ever.

Granted, with all the other challenges in this next normal - reduction or loss of OD/NSF fees, non-bank loan competition, dwindling interchange fees - sometimes looking beyond what needs to be done tomorrow is understandably difficult.

But the next generations of banking customers aren’t going to turn into their parents this time around. 

Digital services have personalized almost every experience they have as consumers. They aren’t patient with “dumb” tech. And when it comes to their money, they’ve seen their parents’ fortunes and nest eggs wiped out in a matter of months. They’re not going down the same road.

Actually, why should they? There are so many alternatives now. Many of these folks are the ones who have built the head and heart of the digital banking solutions available today because, well they could.

They didn’t grow up putting a high-performance camshaft in a muscle car or tinkering with a carburetor. They didn’t help their friend’s family build a deck. They were writing code and building systems.

And now, at this time of change, they’re pulling away from some of the dearly held concepts in traditional consumerism. 

This shift may be subtle. But it’s going to gain momentum and duration. And either current community banks and credit unions need to think about how they’re going to adapt to a primarily digital customer base or they will be another artifact among the ruins of other seemingly unassailable industries.