The Credit Union Awareness Gap: Why 30% of Gen Z and 21% of Millennials Don’t Know They Can Join a CU

March 21, 2025

By: Ben Malena

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Despite the increasing demand for affordable and community-focused financial services, a significant portion of younger generations remains unaware that they can join a credit union. A recent survey found that 30% of Gen Zers and 21% of millennials do not realize that credit unions (CUs) are an option for their financial needs. (Credit Union Times)

This lack of awareness represents both a challenge and an opportunity for credit unions. As traditional banks continue to dominate financial services among younger demographics, credit unions must address the visibility gap to attract new members. This article explores why this knowledge gap exists, what younger generations expect from financial institutions, and how credit unions can bridge the divide.

The Growing Awareness Problem

The financial services industry has seen a generational shift in banking habits, yet credit unions have struggled to maintain engagement with younger consumers. Only 4% of Gen Z and 5% of millennials are currently credit union members, highlighting a significant issue in outreach. (World Council of Credit Unions)

Current Membership by Generation

A breakdown of credit union membership by age group shows that younger generations are significantly underrepresented:

• Silent Generation (born before 1946) – 5% of members
• Baby Boomers (1946–1965) – 39% of members
• Generation X (1966–1980) – 25% of members
• Millennials (1981–1996) – 21% of members
• Generation Z (born 1997 or later) – 10% of members

In contrast, large banks account for 80% of Gen Z’s and 75% of millennials' primary financial services—a major gap that credit unions must work to close. (McKinsey & Co.)

Why Are Gen Z and Millennials Overlooking Credit Unions?

1. Lack of Visibility and Marketing

Unlike big banks, credit unions tend to have smaller marketing budgets, leading to less exposure among younger demographics. Gen Z and millennials, who rely on digital and social media platforms for financial information, often encounter aggressive marketing from major banks but rarely from credit unions.

2. Perception of Exclusivity

Many younger consumers mistakenly believe that credit unions are exclusive to specific employers, government agencies, or unions. While some credit unions still have membership restrictions, many have opened their doors to broader communities. Unfortunately, this change in accessibility has not been well-communicated to younger audiences.

3. Digital Expectations

Gen Z and millennials prioritize digital banking, yet many credit unions lag behind in offering seamless, user-friendly mobile banking experiences.

• 72% of millennials and 63% of Gen Zers prefer to bank digitally, yet many credit unions have outdated mobile apps. (LinkedIn)
• Only 51% of Gen Zers and 58% of millennials report satisfaction with their current financial institution's digital services. (Apiture)

4. Financial Stress and Paycheck-to-Paycheck Living

With 73% of millennials and 66% of Gen Zers living paycheck to paycheck, financial concerns drive their banking decisions. (PYMNTS) However, credit unions have not effectively marketed their lower fees, competitive loan rates, and financial wellness programs as solutions to these challenges.

The Opportunity: Attracting Younger Members

Despite the awareness gap, younger consumers are open to switching financial institutions—if credit unions meet their needs.

• 47% of Gen Z and millennials say they would consider switching to a credit union or community bank.
• 41% of Gen Z and 38% of millennials prioritize the ability to open and manage accounts online. (Apiture)

How Credit Unions Can Close the Gap

1. Enhance Digital Banking – Investing in seamless mobile banking apps with AI-driven financial tools, budgeting features, and real-time notifications.
2. Improve Marketing & Awareness – Targeted social media campaigns on platforms like Instagram, TikTok, and YouTube to educate younger consumers.
3. Offer Financial Literacy Programs – Webinars, TikTok explainers, and app-based educational tools can help Gen Zers and millennials build better financial habits.
4. Promote Ethical Banking – Younger generations care about community involvement, sustainability, and ethical finance. Highlighting these values can attract socially conscious consumers.
5. Simplify Account Opening – Making it easier to open an account online and transfer financial services seamlessly from existing banks.

The Future of Credit Union Membership

Credit unions have a unique opportunity to position themselves as affordable, community-driven alternatives to traditional banks. However, without increased visibility and stronger digital offerings, they risk losing younger generations entirely.

By embracing digital transformation, financial education, and targeted marketing, credit unions can turn today’s awareness gap into tomorrow’s membership growth. Addressing these challenges now will ensure that Gen Z and millennials view credit unions not as outdated institutions but as the future of personal finance.

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