There was a time, not so many years ago, when a message from your bank popping up on your computer monitor would have been downright unwelcome. When befriending your bank on a social network was unthinkable. Complain to your bank and get a written personal response in minutes? Don't make us laugh ...

Even as recently as a year ago, Thefinancialbrand.com published Why Social Media Is a Waste of Time for Most Banks & Credit Unions, arguing that social media is useless for the financial sector.

Well, as we know, that's all changing. Banks and other financial institutions are becoming increasing social: because they have to (customers are demanding it) and because they want to (win our custom by engaging with us).

Banks can see the benefits of social media for:

  • Customer Service (for example, the @askciti Twitter account)
  • Research and Development (in the way that First Direct uses its First Direct Lab to develop and road test new products)
  • Insight - what better way to learn what your customers are saying about you?
  • Recruitment (JP Morgan’s Facebook community gives potential employees sneak preview)
  • Sharing information, for example about your corporate responsibility programme
  • Creating brand ambassadors
  • Reaching a younger audience, as HSBC does so successfully with its Facebook student programme.

But it's a steep learning curve for financial organisations: learning how to work within the tightly regulated environment; how to set rules for their communities; how to control staff social media use; learning how to accept and respond to criticism; moderate and engage.

eModeration has consulted experts in the field (including the redoubtable Christophe Langlois) and looked at examples where social media is being used intelligently. Our Guide to to Managing Social Media Engagement for Financial Organisations (free to download from our site) includes advice on developing and managing online customer communities as well as offering guidance on handling potential social media crises.