Social on the rise

Implications for the industry of the blending of popular platforms and digital banking.

Being clear about storing and protecting customers financial information

The influence of technology and innovation on the banking industry has accelerated significantly over the past twelve months. As digital and mobile banking have enhanced the customer experience with on demand account access, we’re now also seeing the influence of a host of other technologies making an impact, such as social media and wearable tech.

Social media payment features

These are about to provide enhanced access to personal finance management and the ability to pay for goods and services, but the use of social media towards this objective is particularly interesting.

Snapchat recently joined the pool of social brands venturing into the payments sphere. The photo sharing app partnered with payment-processing firm Square to offer users a peer-to-peer payment feature called Snapcash, which allows users to send money to others via the Snapchat app.

In line with developments such as these, we asked 2,000 UK consumers last year which brands and money management services they would prefer to use to send money. Some mentioned Snapchat but Facebook proved the most popular, with 19% of 18-30 year olds saying they would use a Facebook payments service.

The next generation of media savy customers

The 2014 World Retail Banking Report from Capgemini has highlighted a widening gap between customer expectations and the delivery of social banking services. The growing prominence and influence of The Millenials is an important driver behind these findings, and clearly highlights the challenges banks are facing in meeting the evolving demands and high expectations of the digitally-savvy younger generation.

Banking on Facebook and Twitter

To accommodate this demand, Facebook is currently preparing to allow users to make transfers via its messaging service, while Twitter has partnered with French bank Group BPCE to allow customers to send money via a tweet.  But earlier this month a further development was announced that hints at the growing impact of social technologies on the future banking experience.

Indian bank Kotak Mahindra launched a service that allows customers to open and manage their savings accounts through Facebook and Twitter. Its customers are now able to sign up via their Facebook account, manage tasks using the ‘Hashtag Banking’ system on Twitter and receive a private reply from the bank through a direct message.

The facility also offers the option to top up a mobile phone account, request a cheque book or credit score, and in true social media style, a rewards programme for online purchases and new customer referrals.

Instant and easy services

The implications for other banks is clear: social is coming… so in order to meet the needs of a customer base that are getting younger and more expectant of an instant and easy service, this growing platform cannot be ignored. 

As always however, with the integration of technology and financial information, the initial challenge will be a familiar one – security – it will be vital to clearly outline exactly how customers’ financial information will be stored, accessed and protected.