Logging into your bank via Facebook or other social media platforms is soon to be the norm. Experts are touting the benefits, and big names are joining the movement such as ING Bank and Emirates Islamic Bank. This might have seemed unthinkable even five years ago. However, with the growing population of Gen Y and Gen Z, we are becoming more reliant on social media, and in turn it’s offering access to more online services and functionality – beyond chatting with friends and posting news. Digital giant WeChat is one such platform at the forefront of this. With over 700 million monthly users, what began as a messaging app now doubles as a mobile wallet, allowing you to check in for flights, pay utility bills and more. This is helping change our perception of what can be achieved from our social media account.
Social banking will allow users to access online banking services using their social media account credentials via the bank’s normal homepage and log in portal. They would then check their balance, make transactions and view any other information as normal. The professed benefits of this method are many; including improved user experience with a quicker route to authentication and fewer passwords to remember, reducing frustration and allowing users to more efficiently multitask.
Access to greater pools of data from social media means that service providers can personalise services to customers and offer them access to tailored and timely offers. For instance, suggesting the best rates available for a student current account following the school graduation of a user. Further to this, the enhanced insights from your social profile could link to your current place of work or address, might help bank managers make quicker decisions in terms of granting business loans or mortgage applications. A win-win for banks and consumers.
However, many are concerned that social banking represents another inroad into our privacy, with ever more eyeballs privy to our most personal information and profiles. Many may question whether they fundamentally want their financial service provider, their partners and affiliates, having this window into their personal lives – and that of their friends and families. The increased ease of access and potential third party interference that comes with social banking is raising eyebrows for many; and with cybercrime growing – some might be uncomfortable that a hack of your Facebook account, could also wipe out your bank balance.
There will be many opinions to take into account on this topic, and it might be several years until social banking becomes mainstream – however it is undeniable that all things digital and social are now critical to keep abreast of financial services. To deliver on innovation and keep ahead of the competition, a fundamental change in operating will be needed in order to deliver new products and services – efficiently and securely. But before banks even consider if they are able to take the plunge to deliver on social banking, they should review if their IT infrastructure is agile enough to be able to flex to meet the demands of these services. Increasingly, IT prowess is becoming indicative of the health and capability of the business; and what we’re likely to see over the coming years in terms of social banking, is that those who don’t get involved with this trend will be left behind with the rise of the younger generation.