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Is Google (Bank) coming for you?

Millennials would rather bank with Google, Apple and Amazon

Now that Google has officially entered the automobile industry with the release of its driverless car prototype, the question must be asked: What’s Google going to do next? 

How about the Bank of Google? Or Google Bank? What about Google Savings and Loan? Or what about Google Mortgage? 

They already have all of your personal information. So, it wouldn't be that difficult to take that next step.

Well, if the vast majority of millennials have their way, that’s just what Google, Apple and other tech companies should do next.

According to a survey from Accenture, 72% of 18-34 year olds would be “likely” or “very likely” to bank with companies like Apple, Google, Wal-Mart, T-Mobile or even the U.S. Postal Service if they offered banking services. They’d rather bank with the post office than a traditional bank?!?!?! Marinate on that for a minute.

While banks have made it easier with apps and online banking, you have to think that there is some harbored bitterness towards the big banks after the events that led to the recent financial crisis. And if millennials prefer the post office to banks, well that tells you exactly how they feel about banks.

Banking with the post office isn’t that far-fetched. The USPS is already considering it, in fact. In England, you can do your personal banking at its branch locations, and even get a mortgage.

Note: Accenture’s survey asked a theoretical question about whether consumers would bank with nonbank companies if they offered banking services. To me, the answers weren't that surprising and this blog is my extrapolation of those findings. Among consumers ages 18 to 34, 40% said they would consider banking with Google, 37% would consider banking with Amazon, and 34% would consider banking with Apple if those companies offered banking services.

Doesn't a company like Apple have far more trust built up amongst millenials than the big banks do? I think so. So how long will it be before the big tech companies begin to look at banking as a way to expand their brand?

Imagine googling the word “bank” and landing on Google Bank. What if every iPhone came pre-loaded with Apple Bank? That’s how easy it would be for them to completely own the market.

“Tomorrow’s consumer is coming of age with a very different perception of what a bank could be,” said Wayne Busch, managing director of Accenture’s North America banking practice. “Those expectations could become profoundly disruptive to banks if non-bank entrants gain momentum and banks fail to adapt quickly. This will have important implications for the ‘digital generation’ spanning nearly all age groups.”

Banks are going to need to think a little more outside the box and not simply rest on their laurels. People want more than the same old song and dance from their banks. More than half of the survey’s younger respondents (57%) said they would welcome more help from their bank in the process of purchasing a home. That includes recommending areas, homes, and even realtors who work in the area.

Even the slightly older crowd wants more help from their bank in the home buying process as well. According to the survey, 47% of those from ages 35 to 55, and 24% of those over 55 want their banks to do more in the home buying process. Simply lending the money isn’t going to be enough anymore.

“Banking is widely viewed as a purely transactional activity, but people are seeking advice and relationships that improve their financial well-being,” said Robert Mulhall, a managing director in Accenture distribution and marketing services. “In this digital era, the most successful companies focus on solutions, rather than products, to simplify their customers’ everyday lives. Banks also need to think this way.”

And isn’t this industry ripe for a little creativity and some true forward thinking? How many years have we done the same thing? We shout about housing finance reform in an echo chamber as Washington ponders the latest legislative effort to change the system – one that appears set to die a slow and uneventful death, by the way.

So who’s to say that Apple, Google or Amazon couldn’t come in and offer something new and different to the younger homebuyer? It’s a market segment that’s largely left behind right now. Many younger people want to buy a house, but simply can’t do it because they can’t get the loan they need

Google already has experience in the financing space in a couple of different forms. Google Capital recently invested $50 million with Auction.com. They've also tried their hand at mortgage pricing and real estate listings.

Maybe Google can come up with a way to facilitate homeownership that us simpletons (two thumbs pointing at this guy) haven’t thought of yet. As someone who’s on the upper end of that 18-34 age range, I can tell you that buying a home is still very important to people my age.

Fifteen years ago, the internet was still this new amazing thing that many of us could only access using a dial-up modem. I remember being excited when my parents got a 33.6 kbps modem because it was light years faster than our 14.4k modem. No more lag time when I post my witty bon mots in AOL chatrooms??? SCORE!

Now I carry the totality of human knowledge around in my pocket every day. And I ignore it so I can play Angry Birds again.

My point is who knows where we’ll be in 2030. Maybe the “too big to fail” banks will still be here. But maybe our mortgage payments will be automatically withdrawn from our Google Bank account while we use our Google device to search for the latest cat video on YouTube, which is owned by Google, by the way. And we’ll be doing it all while sitting in the backseat of our driverless Googlemobiles.

Or maybe it’s just all done inside our brains because we’ll all be implanted with Google brain chips. I wouldn’t put it past them.

Banks better be ready to evolve with the times. Apps and online banking won’t be enough. They’ll need to do more. And don’t think for one second that young people won’t leave the banks behind in a less time than it takes to watch the latest cat video. Because millennials need more, want more and trust less. So look out big banks. Apple and Google are coming for you. And they’re ready to take all your customers with them. 

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