Charity begins at home, as the old saying goes, and that can mean one’s community as well. New data finds a powerful correlation between bank choice and a bank’s charitable standing.
For the study “Financial Institutions And Customer Loyalty: The Value Of Investing In Your Community,” a PYMNTS and Elan collaboration, we surveyed over 2,500 U.S. consumers about their feelings on financial institutions that support their local communities, finding a well of sentiment around this issue, especially among younger demographics.
Per the study, “Those consumers who are strong supporters of charitable organizations often prefer to do business with establishments that support local charities, particularly with financial institutions (FIs). PYMNTS’ data finds that an FI’s lack of support for local charities can persuade one-third of customers to move their accounts elsewhere, and the age groups most impacted by charity participation are bridge millennials and millennials.”
Compared to the 14% of baby boomers who would switch a banks or financial institution based on its local charity work — or lack thereof — the study found that younger demographics are far more likely to move their accounts to FIs they see as supporting local communities.
In all, “43% of bridge millennials and 42% of millennials would move their accounts over to FIs that charitably support their local communities. The readiness to switch FIs because of a bank or credit union’s support for local charities is less pronounced among other age groups.”
Interestingly, high credit card spenders are the most likely to switch to an FI that donates more to local charities, with 37% of consumers classified as nonrevolving spenders and 42% of revolving spenders saying they are likely to select FIs more supportive of their locales.