Why Social Media is Imperative for Banking
Social Media is dawning as an important channel in the old school banker's horizon. RBI has issued Social Media guidelines for Banks to follow. ICICI Bank has already launched (early 2013) it's Facebook (FB) Application as well as a social media enabled product iwish.
Another important development involves new banking licenses, thus making the incumbent banks move faster and innovate to acquire and engage the socially mobile (pun intended) customers. Other developments include, allowing for profit BC (Business Correspondents), Mobile Wallets linked to IMPS and RUPAY, the indigenous card platform from NPCI. NPCI also plans a convergence in payment platforms, namely ATM network, IMPS, AEPS and NEFT.
While NEFT presently uses ISO15022, the rest of the platforms use ISO8583 '87 version. The road ahead is to UNIFI all the channels.
RBI on the other hand still retains the control of RTGS , but is in the process of modernizing the infrastructure by implementing UNIFI (ISO20022).
Still 6 out of 10 Indians do not have a Banking account, but 7 out of 10 Indians have mobile.
Smart Phones have become cheaper and a low cost Android phone can cost as low as INR 2400. Many lower middle class Indian, like taxi drivers and office peons have INR 40,000 phones, thanks to EMI and aspiration of upward mobile lifestyle. Mostly all Indians having a smart phone have aFacebook account.
Thus the next generation banking innovations cannot ignore Social Media and Smart Phones.
IDRBT Social Media Framework
B. Sambamurthy, Director, IDRBT lists a 10 point plan for Banks in the foreword of IDRBT whitepaper titled "Social Media Framework for Indian Banking Sector".
- Establish business goals
- Establish social media goals
- Align to business goals
- Draw up social media strategy
- Design and implement social media organisational structure
- Design and implement a plan to build social media operational capabilities
- Establish a mechanism to handle adverse events
- Place right skills, staff
- Place controls for customer engagement and dissemination of information
- Create new social media business unit and fund it.
While this paper, covers governance, security and Legal frameworks; this paper tows the popular pitch given by the Social Enterprise technology providers. It misses the vital transaction and commerce aspects of the Social Media.
