Social Media keeping Middle Banks 'scared'
Banks in the Middle East must embrace connectivity and create successful social media strategies to connect with their customers, senior bankers emphasised at a retail banking forum in Dubai on Monday.
“Banks aren’t prepared for social media and we are scared of it because it’s very transparent,” said Sanjoy Sen, managing director, Retail Banking – Asia Pacific at ANZ.
Traditional bankers typically have a mindset where they pass on information that they deem important to the customers, whereas today’s customers want to interact and engage with their lenders, he explained.
“Banks who develop an effective social media strategy will be the banks of the future,” Sen said.
The move towards digital is vital in the Middle East, where internet penetration and social media penetration rates are among the fastest growing in the world. Up to 28 million people in the region log on to Facebook on a daily basis, while Saudi Arabia’s twitter usage rates are the highest in the world, at 41 per cent.
“Most young customers are extremely interconnected and depend on peer-to-peer advice rather than turning to the bank,” said Surash Bajpai, head of Retail Banking, Doha Bank.
“So lenders have to become more relevant, understand the lifestyle of the consumers and merge into it faster than their competitors,” he said.
David Power, head of Retail Banking Group at Commercial Bank International, added: “The way you talk to customers and non-customers is very important. The problem is that they expect an instant reaction from you and hence managing that is very critical.”
One of the main challenges for regional banks is that in most instances, the top decision makers belong to a generation that doesn’t understand social media and hasn’t really used it. However, bankers at the forum urged lenders to invest in bringing in new talent and to collaborate with technology and telecoms partners to bridge the gap.
“There has to be a transformation of the entire banking business model, accompanied by a change in the cultural mindset,” advised Sen. “Banks can really boost profits if they embrace digital.”
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