Over the past decade, Latin America has achieved great strides in expanding financial inclusion. But what will the next 10 years look like?
At Galileo, we believe the next phase of financial inclusion in LatAm will be defined less by simply getting more accounts to more people, and more by qualitative improvements in the financial tools available to consumers across all demographics–thereby enabling them to better achieve their financial goals and improve their financial health.
One area where payment providers can enhance the financial experience for all is by looking at the needs and behaviours of older and younger consumers. LatAm’s over-65 population is set to double between 2024 and 2050. Meanwhile, Gen Alpha is projected to total 2.5 billion people by 2025, and will possess the greatest purchasing power in history.
The question for LatAm banks and financial services providers is how to respond to these demographic changes with a tailored and rewarding banking experience.
Bridging the generational divide
Older Latin Americans are increasingly online; for instance, the number of Brazilians over 60 using the internet daily has more than doubled since 2019. Despite this, digital security concerns persist. As older adults spend more time online, studies have found them more vulnerable to certain types of financial fraud associated with digital banking, such as tech support and e-commerce. Because of this risk, it’s particularly important that the types of financial services provided to older audiences are simple and secure.
Effectively responding to these dynamics can help banks’ competitive positioning. For example, BMG recently was named the best bank for older customers in Brazil, due in large part to the bank’s efforts to meet the needs and preferences of older customers, such as no fees on accounts, no annual fees on cards, and tailored credit aimed specifically at retirees, pensioners, and civil servants.
As the BMG example highlights, understanding older customers’ unique profiles and preference for simple, secure, humanized services can help better serve that demographic, increasing true financial inclusion for an entire generation.
Younger consumers, on the other hand, prioritize seamless, integrated financial experiences, often preferring to manage all services within a single app, including embedded payment and buy now, pay later options, making these types of unified financial capabilities a competitive differentiator for providers.
Meanwhile, younger consumers are looking for help and support in making financial decisions, with 70 percent of Gen Z reporting wanting more help and support when making financial decisions, and 68 percent saying that their banks should be doing more to help. Financial education is crucial for serving Gen Alpha, with 82 percent of Gen Alpha parents wishing for more tools to teach young people about finances.
Embracing Gustanomics for true financial inclusion
Our Gustanomics model offers a powerful path for banks to champion financial inclusion across all age groups in Latin America. In a world where the average Latin American spends five hours a day on social media and 76 percent are willing to switch banks for a better digital experience, traditional brand loyalty needs to be redefined.
By seamlessly integrating banking services into platforms customers already use and focusing the banking experience on their needs—from proactive guidance and financial education for younger users to secure, no-fee accounts for older customers—banks can deliver the seamless and human service users demand. By prioritizing targeted incentives, humanized engagement, and leveraging the power of social connections, banks can make financial management more accessible and intuitive for all generations, building stronger relationships and driving genuine financial inclusion.
Explore further insights on demographic-driven banking strategies in our comprehensive Gustanomics guide and contact Galileo to learn more.
For older consumers, banks should provide simple and secure financial services, such as no-fee accounts, no annual-fee cards, and tailored credit products, while addressing digital security concerns. For younger consumers, banks should focus on seamless, integrated financial experiences within a single app, offer embedded payment and buy now, pay later options, and provide more help and financial education to support decision-making.
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