A new Sogolytics study reveals that Millennials and Gen Z are drifting away from credit unions, with membership dropping sharply and many younger consumers viewing them as outdated or misaligned with their values. At the same time, strong satisfaction with digital banking and interest in youth-focused accounts highlight clear opportunities for credit unions to win back relevance.
A new nationwide study by Sogolytics highlights the challenges credit unions face in capturing the loyalty of younger generations, despite a strong alignment of values and increasing interest in digital banking.
Awareness & Perceptions
Nearly half (49%) of Gen Z say they’ve heard of credit unions but don’t understand how they work. Perceptions of being outdated persist: 17% view credit unions as “for older people,” while another 17% believe they are “not modern enough.”
Usage & Decline
Credit union membership among Millennials has fallen sharply, from nearly 31% in 2023 to just over 22% in 2025., only 23% of Millennials and Gen Z use a credit union as their primary financial institution, compared with 37% who rely on commercial banks.
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Values Disconnect
While two-thirds of Millennials and Gen Z say they try to support brands aligned with their values, only 35% feel their financial provider reflects those values. Notably, 34% of younger consumers who feel no values alignment still remain with their provider, citing convenience as the main reason.
Digital Divide
Digital banking is now essential for younger consumers—47% prefer to manage finances through mobile apps. While 12% still describe credit unions as “not modern,” nearly half (47%) of Millennial and Gen Z credit union members report being very satisfied with their digital experience—higher than commercial and community banks.
Switching & Opportunity
The research also reveals a significant growth opportunity: 47% of non-members say better rates or fees would motivate them to switch to a credit union. Even more striking, 85% of Millennials and Gen Z say they would consider a youth-focused account, signaling a clear path for credit unions to grow membership.
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