Baby Boomer Generation Also Embracing Mobile Banking Trend

Publication of South Korea Financial Consumer Report 2024
80% of Ages 59-64 Use... Internet Bank Transaction Rate 66%... Up 11%P

As mobile financial service usage among the baby boomer generation aged 59 to 64 has significantly increased, the influence of mobile channels in the financial sector is expanding further.

Hana Financial Management Research Institute announced on the 4th that it published the "Korea Financial Consumer Report 2024," which analyzes the financial transaction characteristics of Korean financial consumers aged 20 to 64 as of July last year. This report has been published regularly since last year and analyzes the characteristics of the transaction journey in which financial consumers form and expand relationships with banks.

The transaction rates with internet-only banks and fintech/bigtech institutions continued to rise following last year. In particular, the internet-only bank transaction rate for the baby boomer generation (born 1946?1965) was 66%, an increase of about 11 percentage points compared to last year. The fintech/bigtech transaction rate (88%) also rose by 8 percentage points, showing a significantly larger increase than other generations.

Looking at the bank channel usage status of the baby boomer generation, the mobile banking usage rate was 80.7%, up 6.9 percentage points from 73.8% the previous year. Conversely, the bank branch usage rate fell by 7.9 percentage points from 50.3% to 42.4% during the same period.

The increase in mobile financial transactions among this generation is due to more active use of basic services such as account inquiries, as well as increased use of additional services. Growing interest in asset management services also had an impact. Compared to other generations, this group has relatively larger asset sizes and higher financial transaction loyalty, which can have considerable ripple effects in the market.

Within the past year, 4 out of 10 financial consumers started transactions with a new bank. Among them, more than 30% chose the bank because of the convenience of the mobile channel. However, only 16% expressed an intention to expand transactions with that bank, and only 41% planned to maintain their current level of transactions.

Consumers deposited 53% of their financial assets in one main bank they considered the most important among an average of five banks they transact with. One in ten changed their main bank within the past year, and this was attributed to the mobile channel.

Also, consumers have installed applications (apps) from four out of the five banks they transact with on average and conduct transactions via mobile. While commercial bank apps focused on financial service usage, internet-only banks activated various services such as additional services and integrated management of other accounts. Among financial app users, 9.7 out of 10 rated their satisfaction with the apps they use as "average or higher." There was little difference by brand, indicating that service quality has reached a certain level. Digital asset management experience has also become widespread, exceeding 80%, but the usage rate of MyData services remains around 20%.

Additionally, when considering the amount left after expenses such as consumption and loan repayments from monthly household income as "savings capacity," 28% of consumers had more than half of their income remaining, indicating strong savings capacity. This is a slight increase from last year (25%). However, consumers with low savings capacity, who have less than one-third of their income left, also increased from 32% last year to 35%, showing polarization in household finances.

This content was produced with the assistance of AI translation services.