NEW YORK—For credit unions, the Gen Z challenge has shifted from providing digital access to proving relevance at moments that shape financial confidence, according to PYMNTS.
That theme runs through “Digital-First Retention Playbook: Winning Gen Z Loyalty at Credit Unions,” the October 2025 edition of the PYMNTS Intelligence Credit Union Tracker Series produced in collaboration with Velera. The report finds Gen Z members are both highly desirable and highly unstable relationships. Many inherit credit union memberships from family, but they report less control over their financial lives and a greater willingness to switch providers when expectations are not met. Digital fluency is assumed, not rewarded; what differentiates institutions is personalization, trust and practical guidance across digital and physical channels.
The research shows a generation that blends self-service with human interaction and increasingly turns to artificial intelligence for planning and reassurance. Gen Z uses digital tools not only to transact but to test scenarios, compare options and navigate financial uncertainty. Credit unions retain an advantage rooted in trust and familiarity, but that edge narrows when digital experiences lag or messaging feels generic. Loyalty, the report suggests, is earned through consistency across channels and relevance at key decision points rather than legacy ties alone.
The data underscores the stakes:
- 36% of Gen Z credit union members say they are likely to consider leaving their institution, compared with 14% across all age groups.
- 72% of Gen Z consumers say they face financial challenges unique to their generation.
- 62% express interest in using AI for “what if” financial planning.
Beyond the headline figures, the PYMNTS/Velera study highlights subtler tensions shaping engagement. While digital-first, Gen Z does not equate digital with isolation. Nearly half prefer in-person interaction when seeking financial advice—more than any other age group—but expect continuity across channels. Experiences that fail to carry context from mobile to branch erode trust, while seamless transitions reinforce credibility.
The report also points to a paradox. Traditional credit union strengths such as community focus and lower fees resonate less with Gen Z than with older members. Yet Gen Z rates credit unions relatively well on understanding their needs and technological capability, creating an opening to reposition long-standing values through insight-driven engagement and practical digital tools.
AI emerges as both risk and opportunity. As generative tools make product comparisons easier, loyalty becomes more fragile. At the same time, transparent, responsible AI-powered guidance can strengthen relationships, the report suggests.