71 Million Underbanked and Stuck: The Gen Z Financial Access Paradox

Gen Z Is Underserved in Banking - Just Not in the Way You Think

Gen Z Has More Accounts, But Not Better Banking

In my years building growth engines and influencing the design of financial products, I’ve learned that “underserved” isn’t just about who lacks access. It’s about who’s being served by the wrong products entirely.

There are 70.8 million people in Generation Z in the U.S., defined as those born between 1997 and 2012. This generation makes up about 20.8% of the total U.S. population.

On the surface, Gen Z has bank accounts, digital wallets, Venmo, and a dozen fintech apps. By traditional definitions, they’re hyper-served. But look closer, and you’ll see a generation that’s technically banked but structurally excluded. They have access without much progress, accounts without strong momentum. They’re underserved in spirit, if not in statistics.

Note: Gen Z isn’t one monolith, and not all members of Gen Z face the same financial challenges. There are wide differences across income, geography, and life stage. The goal here isn’t to generalize, but to spotlight some of the common financial realities many young adults face, and how product and marketing can do better by meeting them where they are.

🔍 Gen Z’s Financial Reality

Gen Z (roughly ages 18–27) is entering its prime banking years, but their financial lives look nothing like the ones banks were built for.

Volatility is normal. Many juggle side gigs, student debt, and unpredictable income. Savings are thin, and reliance on gig work can be common. The stability banks assume i.e. steady paychecks and consistent balances etc. simply doesn’t exist.

Lack of long term progress. Many rely on products that prioritize convenience and cash access over long-term credit building. Access isn’t the problem; progress is.

Values-driven and marketing-savvy. Most will switch institutions over transparency, fairness, or inclusion, and spot inauthenticity instantly. Corporate slogans about “financial freedom” don’t resonate when they’re worried about making rent.

The irony is stark: the generation most connected to digital finance is also the one being quietly left behind by it. They’re not outside the system; they’re stuck in the wrong part of it.

And that makes them the next frontier for financial institutions willing to rethink both product and marketing.

🎯 Why Traditional Banking Fails Gen Z

The Product Failure
Most banks still design for predictable financial lives: thick credit files, steady paychecks, and consistent balances. Minimum-balance rules, overdraft fees, and rigid underwriting all penalize volatility.

Even digital-first banks often modernize the interface but not the logic. Sleek UX cannot hide products built on outdated assumptions about stability.

The Marketing Failure
Financial marketing still speaks the language of aspiration e.g. “grow your wealth,” “premium rewards,” “retire early.” None of that resonates with a generation trying to build credit or pay off student loans.

When your creative showcases luxury travel rewards and your targeting optimizes for high LTV, you’ve already excluded Gen Z. Even when banks try to be relatable, the tone often feels forced, with memes and slang wrapped around the same old products.

Gen Z doesn’t want to be marketed at. They want to be understood. And most institutions don’t know how to do that.

💡 How to Flip the Script: My Field Experience

In my experience managing student loans, personal loans, and other core banking products, I realized this generation’s relationship with money isn’t built on aspiration; it’s built on anxiety and small wins.

So we scrapped the glossy campaigns about “financial freedom” and started showing real progress: a student paying off one loan, someone finally building credit, another saving their first thousand dollars. It was messy but real, and it worked.

Our creative shifted from “look how successful you can be” to “we get why this is hard.” Every line was rewritten for clarity, every ad tested for trust. The more we stripped away polish and pretension, the better the response.

Our best marketing tool was testimonials. There’s no better advertisement than a customer who talks highly about your brand. You can run that ad all day long, and it’s free.

People said things like “finally, a brand that talks like a human” or “this doesn’t make me feel bad about where I’m at.” That’s when you know marketing is doing its job, not pushing a product but lowering people’s guard.

Gen Z doesn’t reward perfection. They reward honesty. When you show them you understand how their financial life actually feels, they listen, and they stay.

💡 The Playbook: Product + Marketing

Product Strategies

Design for volatility. Build products that assume irregular income: flexible bill-payment windows, auto-savings triggered by deposits, and overdraft prevention instead of penalties. Gen Z’s financial lives are inherently volatile; expect that, don’t punish it.

Expand underwriting beyond FICO. Most Gen Zers have thin credit files. Use alternative data such as rent, utilities, and cash flow income.

Build transparent pricing. Every cost should be upfront and explainable. Transparency isn’t just ethical; it’s a competitive advantage.

Marketing Strategies

Rewrite messaging for empowerment, not aspiration. Stop talking about “building wealth” and start talking about “financial peace of mind.” Gen Z doesn’t need premium perks; they need transparent pricing and products that respect their reality. Use plain language, show empathy, and lead with what you won’t do as much as what you will.
Test every piece of copy with this filter: Would this feel tone-deaf to someone working three gig jobs? If yes, rewrite it.

Go where Gen Z actually lives. They’re on TikTok, Reddit, Discord, and YouTube, not Facebook. And they trust creators more than brands. Shift your budget from traditional social to partnerships with financial educators who already have Gen Z’s trust and give them real editorial freedom.

Also, don’t ignore offline. Partner with community colleges and workforce where folks have irregular income.

Make customers your storytellers. The most powerful marketing isn’t a polished campaign; it’s a TikTok from a real customer showing how they raised their credit score from 580 to 720. Build referral loops that make sharing easy and rewarding. Our top acquisition channel became referrals once we made it feel like helping a friend, not promoting a product.

Create content that serves before it sells. Gen Z doesn’t want ads; they want value. Build educational content that helps: “How to build credit with no history” or “Five ways to budget when your income fluctuates.”

Optimize your funnel for skepticism, not just conversion. There is a high degree of skepticism in financial system, and justifiable so. Anticipate objections and address them clearly, even before they’re raised. Our FAQs were written around skepticism, not compliance.

Measure what matters for the long term. Track trust and progression, not just acquisition. Measure how many customers graduate from starter products to credit-building tools. Watch NPS and sentiment since they’re leading indicators of loyalty.

🌱 It’s the Same Playbook for the Underserved

The playbook for serving Gen Z is the same playbook for serving the traditional underserved, the 24 million U.S. households that are unbanked or underbanked. They face the same barriers: irregular income, thin credit files, distrust of institutions, and products designed for a stability they don’t have.

When you build inclusive products and authentic marketing for Gen Z, you’re also building for communities that have been systematically excluded. The strategies converge: design for volatility, expand underwriting, lead with transparency, meet people where they are, and make them the storytellers.

Solve for Gen Z, and you solve for everyone traditional banking has failed.

Gen Z isn’t a demographic to “target.” They’re a litmus test for whether your products and marketing are modern, equitable, and human. They’re 71 million strong in the U.S., entering their prime earning years, and they have zero patience for institutions that don’t earn their trust.

The opportunity isn’t in chasing Gen Z with memes or influencer campaigns. It’s in building products and marketing that reflect how they live and showing them you understand before you ask them to convert.