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When reading the results of our January 2025 primacy study, I couldn’t help but draw parallels between consumers’ perceptions of their banking relationships and the modern dating era. Consumers - like young singles - don’t seem to be pursuing a goal of happily ever after with a single bank. They are enjoying “dating around” and seem to have accepted that one bank may not be able to meet all their needs. Have consumers permanently embraced the roster mentality? Will banks need to accept being in an endless situationship with their customers? Or have I been watching too much reality TV?
Regardless of your view on my TV habits, consumers’ relationships with their financial institutions are irrefutably evolving. To help our industry stay ahead of consumers’ changing needs, Pinwheel conducts an annual survey of banking behavior. Here are the insights from our most recent study. conducted in January 2025 among 500 employed and banked American consumers.
Infidelity Is On The Rise
While the majority of consumers claim a national bank as their primary, half of consumers across all demographics are spreading their love around.
46% of consumers hold an account with a community bank or credit union
52% of consumers have an account with a digital bank
The appeal of digital banking is even greater among younger generations with a staggering 70% of Gen Z and 64% of Millennials embracing a digital bank account.
National banks should be asking themselves, why the wandering eyes? Relationship psychology dictates that when one steps out on their primary relationship, underlying unmet needs are typically to blame.
Bank Partner Preferences Are Changing
Consumers’ loyalty to primary banks is wavering, with younger generations the most likely to step outside their primary relationship.
42% of Gen Z and 36% of Millennials plan to switch their primary bank within the next 12 months
These dynamics indicate a growing demand for different services and incentives than national primary banks are currently providing. For years, “proximity to a bank branch” was the #1 criteria used by consumers when they chose their primary bank. Thus, national banks with the largest branch footprints handily edged out the limited resources of neighborhood banks and shut out digital banks completely.
However, in our new study, consumers are indicating they are finally ready to let go of their (toxic?) dependence on branches.
What Is Most Attractive to Bank Switchers in 2025?
Proximity to a physical branch is no longer the #1 consideration for any demographic when choosing a bank in 2025. For the first time, consumers are prioritizing account features and digital experience over physical locations.
Checking account features and rates have emerged as the #1 factor for consumers planning to switch banks. Ensuring they have the ideal checking account at the best value price is universally important across all demographics and it of particular importance to Gen X..
“Quality of digital experience” edged out “Checking account features and rates” for the wealthiest consumers across all age groups, with 35% of those earning over $150K ranking digital #1. Millennials across all income brackets also rank digital experience #1 with 40% of this generation preferencing “quality of digital experience” over all other factors.
The majority of consumers prioritize both checking account features and digital experience above proximity to bank branches. This data seems to confirm that - while long expected - the digital tipping point has finally been reached. Furthermore, wealthier consumers and the digital-first millennial generation are willing to pay more for the premium digital experience they desire.
Breaking Up Still Sucks
Despite the availability of many attractive new banking options, many consumers dread the process of switching banks. “Clean breaks” are even more challenging, with consumers often getting trapped in cycles of opening new accounts and never fully transitioning.
68% of consumers reported opening an account they never used due to difficulties in switching direct deposits and recurring payments.
This data is consistent year over year with last year’s consumer insights. Concerns payment deadlines may be missed and accounts could overdraft during the transition of direct deposits and recurring payments have long prevented consumers from switching banks confidently.
39% felt overwhelmed by the process of transferring recurring payments
29% lamented there was no easy way to switch their direct deposit when opening a new account
Due to years of underinvestment in solving these barriers to account activation, financial institutions are plagued with never active or underengaged accounts. And consumers - ever on the lookout for the next best thing - are locked in endless situationships with the multiple banks that could have been “the one.”
Final Thoughts
Happily married couples often explain the secret to their success is that they “never stop dating.” The core principle of this philosophy is precisely the approach I recommend for financial institutions trying to win and keep primacy.
Consumers’ options are abundant and they have proven to have no hesitation to switch banks to better meet their evolving needs. Financial institutions must continue to compete - not just for new customers - but to keep their existing relationships thriving.
- Make it easy to choose you. Offering a frictionless and personalized account opening experience with in app deposit switching inspires confidence and drives usage intent
- Help them cut ties with their exes. Simplify their financial lives with automatic detection and in app switching of recurring bill payments across their legacy accounts.
- Embrace digital as their love language. Consumers are expecting a top notch digital experience with personalized offers that show them you know what’s best for them. This is especially true for Millennials and high-income earners who are in high demand and know their worth.
Don’t take the foundation of your relationship for granted. Just because you’re churning out new exciting innovations, doesn’t mean customers won’t notice new or increased fees on their checking account. Your high value, longstanding customers won’t hesitate to say “thank you, next” if you fall below basic expectations.
