Younger customers don’t trust online banking

Younger customers don’t trust online banking

I invite you to read an extremely interesting article found on finextra on 29/03/07: Younger customers shunning Web banking.

“Around two thirds of younger consumers are shunning online banking services, according to a US study by Mintel, which found that 40% of these 18-34 year olds “don’t trust transactions on the Internet”.
“The study found that only one-third of consumers aged 18-34 are using Internet banking services, with the remainder preferring the human touch.”

Even though we know that security is one of our key concerns when we bank online, I find those figures surprising. I thought that the younger customers, who are used to shop on ebay & amazon, were more confident online…

Web 2.0 & Online Banking
I created this blog to share my passion about web 2.0 and online banking.
Web 2.0 is all about giving the power to the people: a company provides its platform, but it is its clients/users/members who generate the content.

Young people are massively using “web 2.0 “technologies”: they blog, they have a profile on several social networks such as MySpace, and they are keen to contribute and share their thoughts.

Web 2.0 & Youth Market: a good opportunity for the banks
I wasn’t surprised when Gartner advised the banks to use web 2.0 technologies to target the Youth Market.

But we all know how important reputation is for a bank: currently, most banks still refrain from launching a blog or creating a social network, fearing the potential brand damage.

Bad comments must be seen as an opportunity to win back a customer
At the online_banking_summit_2007, during our panel on web 2.0, we insisted on the fact that nowadays an angry customer will always find a way to express its thoughts online, whether it is on your blog or on another one… With web 2.0 customers expectations have increased: now your customers expect you to show you listen to them, they want to be able to trust you.
An aggressive comment is not an issue, but it must be carefully addressed!

Younger customers are neither profitable nor faithful to their bank
At the summit, another speaker reminded us that the younger customers were not profitable, and that they had no problem switching to another bank. Being efficient & cost effective is extremely important.

Web 2.0 & Viral marketing: a cost effective answer
Young people are actively using web 2.0 technologies, and those technologies are relatively inexpensive to leverage. Banks can also make significant savings in marketing: there is nothing more efficient online than word and mouth & buzz…

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Based in London, Christophe is an entertaining social media keynote speaker and a trusted advisor to the global financial services industry on the topics of social media, social business and digital innovation. Christophe has contributed to over 140 events in 18 countries. Currently, Christophe is 'Social Media Senior Managing Consultant' at IBM Interactive Experience. He's also a Digital Advisor at the Financial Services Forum and the Moller Centre (part of the Churchill College in Cambridge). Christophe's views on VisibleBanking.com are his own, not necessarily his employer's.

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