Beyond Finances: What Gen Z Really Want From Their Money

Generation Z—those born between 1996 and 2010—are widely known as "digital natives," but their spending behaviour reveals them to be considerably more than screen-scrolling spenders. With over 382 million Gen Zs, making up 26 per cent of the nation, they are an economic force. And they are not only using financial services—far from it, unlike their predecessors, they're redefining them.

A recent RBI Innovation Hub and EY report, titled Decoding Gen Z in India: Navigating Trust, Tech, and Tactics in the Future of Finance, dives into Gen Z's attitude towards money and reveals a surprising fact: while technology is second nature to them, trust, transparency and human touch remain vital pillars in their financial decisions. They expect seamless digital experiences, but with the warmth of personalised advice, the clarity of purpose-driven products, and the empowerment to build their own financial futures.

Even though they are digital-literate, 83 per cent of Indian Gen Z appreciate a "personal touch" when it comes to receiving financial advice. Family members and friends are the greatest influencers (53 per cent), followed by financial advisers (23 per cent). What is intriguing is that only 7 per cent trust bank representatives and only 5 per cent use financial apps or tools to get advice.

What this suggests is that even the most technically advanced younger generations value personal experience and honesty over cool interfaces. They want plain, honest advice—especially when the topic is long-term goals like investing (61 per cent), saving and budgeting (58 per cent), and planning for the future (45 per cent).

Notably, young women are more proactive in seeking structured learning online, reflecting an increasing reliance on self-learning via digital sources—though still informed by trust.

Banking: Ease, Security, And Wiser Choices

Gen Z are tactical when it comes to banking. A significant 52 per cent of them have more than one account, tending to keep personal and professional money separate. Classic public sector banks remain the first choice for 45 per cent of them due to branch convenience and heritage trust, but private and neo banks are closing the gap with their flashy features and deals.

Still, just 32 per cent are wholly satisfied with the mobile app experience of their bank. The cry is clear and loud: more rewards, easy to use, and intelligent features such as real-time alerts and money tracking.

Trust remains their basis for loyalty. At times of fraud, the majority look to banks or cyber cells, and 57 per cent are convinced lost money can be returned to them, maintaining confidence in formal financial institutions.

Payments: Tap, Twipe, But Only If It Rewards Back

UPI resonates the most with Gen Z, with 69 per cent of them using it regularly. Over two-thirds mention discounts and cashback as the reason they use UPI. Similarly, credit cards are gaining ground—not to borrow, but for rewards. Nearly 46 per cent possess a credit card, primarily for rewards and convenience.

Their top perks? Reward points (29 per cent) and cashback (36 per cent). Evidently, payment devices must be more than mere functional tools—they must offer value.

Spending And Saving: Aspiration Meets Responsibility

Contrary to the trendy stereotype that Gen Z is irresponsible, the facts paint a different picture. While 33 per cent consciously stick to a budget, up to 81 per cent demonstrate some kind of planning. What do they spend most on, their top priority? Not computers or nightlife, but investing and saving (62 per cent).

Women in particular are more fiscally disciplined and are looking forward. Saving for the future, education, or even the buying of assets like homes and cars is their top priority. The challenge is persistence—only 37 per cent save consistently, and poor income or the absence of direction prevents others from doing so.

Investing: Disciplined Risk, Digital First, And Values-Led

Approximately 40 per cent of Gen Z are already in the stock market, while another one-third choose mutual funds and SIPs. However, most choose low-risk and simple schemes with a focus on low risk (50 per cent) and ease of investment (46 per cent) when choosing investments. Bank websites (47 per cent) and investment websites (38 per cent) are among the preference websites.

Honesty and trust are relevant here too—Gen Z wants efficient tools, timely data, and reputation backing. Learning does matter: 26 per cent say they don't invest because they don't know how.

Borrowing: Trust Instead Of Trends

In the instance of borrowing, Gen Z likes to borrow from their family and friends (38 per cent) even from banks (36 per cent). This implies higher trust and flexibility dependence. While in formal borrowing, issues such as trust (55 per cent) and interest rates that are too low (52 per cent) take priority.

FinTechs offering Buy Now Pay Later (BNPL) or instant credit facilities are the rage—but only if they are perceived as ethical and trustworthy.

A Call To Action For Financial Institutions

The takeaway for India's financial sector is simple. Capturing Gen Z's loyalty requires more than being digital-first. Institutions must pair frictionless tech with strong advisory, personalise offerings, emphasise education, and, above all, establish trust.

By using the FUTURE model—Fostering individualisation, Uniting convenience and incentives, Transforming advisory, Upholding discipline, Reassuring brand credibility, and Empowering credit agility—banks and FinTechs can forge long-term bonds with India's most powerful generation.

Gen Zs don't merely want better apps. They want better solutions.