How will the Net Generation impact the financial service industry? Clearly, many of their needs will be the same – personal loans, credit cards, mortgages, car loans and chequing accounts are all products that N-Geners will need. However, the convergence of new technologies and the unique characteristics of this generation will certainly make their impact.

As I have written before, one of the most fundamental changes may be where the Net Generation goes for banking services. The emergence of the peer to peer model in the industry heralds a fundamental shift which may take customers (especially young ones) away from large banks and towards individuals or syndicates for products such as loans. One new service, called Fynanz, is offering to connect students with individual student loan providers – a product that is traditionally a good starting point for a more serious banking relationship. By not catching young people early, banks are less likely to get subsequent business such as car loans or mortgages. (Which can also be arranged through peer to peer lending sites such as Prosper and Zopa)

The Net Generation’s need for transparency and their ability to collaborate is also making an impact on the industry. An example of this is the quickly organized Facebook campaign to stop HSBC from increasing the interest charged on their student overdraft accounts. The “Stop the Great HSBC Graduate Rip-Off!!!” campaign acquired over 4500 members who persuaded the bank to freeze the planned fee increase. While a few years ago customers would have virtually no way of protesting the bank’s decision, today, the Net Generation is armed with tools that are making banks more accountable and transparent.

Lastly, the N-Gen need for speed means that banking will need to take place anywhere and anytime. This means mobile banking and payments. In the technology obsessed Japanese market customers can already do all their banking and pay for many things using their cell phones, a service offered by the country’s telecommunications providers. However, North American and European financial institutions have been slow in bringing these services to their customers.

The emergence of non-traditional players, consumer empowerment and mobile banking are only three of the many changes we can expect. I would be interested to know how some of our readers in the financial service industry are seeing their business change. Your comments would be most welcome.