The trend: Social media is changing how banks connect with customers, setting new standards for user experience. To stay competitive, banks must know how best to leverage social media platforms to reach potential customers.

Where we are now: GlobalData’s “Thematic Intelligence: Social Media in Banking 2024” report says social media is reshaping the banking industry in these key areas:

• Direct entry into banking services: Social media companies aren’t just sticking to running platforms—they’re also offering financial services like lending, payments, and e-commerce. Apps like WeChat, Instagram, and TikTok now let users shop directly within their platforms, increasingly competing with traditional financial institutions (FIs).
• Customer engagement and marketing: Social media lets banks engage with customers more directly and in creative ways. Banks are using platforms like TikTok and Instagram for financial education, targeting younger audiences through influencers. They’re shifting where people go to learn about financial products from traditional advisors to online personalities.
• User experience (UX) influence: Banks are now trying to keep up with the high standards that social media platforms have set for ease of use and personalization. Social media has also become also a place where current customers share complaints or testimonials about their experiences with banking platforms, further pressuring banks to prioritize digital innovation.

How banks can make the most of social media: Social media engagement firm Sprinklr recommends that FIs take these simple steps to engage with customers online: 

• Consider finfluencers, user-generated content, and online communities to build brand authenticity and awareness
• Run precision-targeted ad campaigns and use creative hashtags to reach specific audiences with relevant products and promotions
• Engage customers through interactive tools (like polls and surveys) to build trust and guide them toward informed financial decisions
• Provide social-media-only promotions to encourage engagement and build excitement around the FI’s offerings