Future in banking sector jobs may be in social media

John Greenwood, Financial Post

March 30, 2011

One of the biggest challenges facing the banking sector could become a transformational opportunity for players that get it right.

The advent of social media such as Facebook "has created a tipping point" in the industry as more and more bank customers migrate to increasingly popular networks, says John MacKinlay, a partner with PwCs' financial services team.

The challenge for the banks is they are already way behind other industries in terms of understanding and utilizing the opportunities created by technology, which has created a divide between them and their customers.

"Banks have been slow to embrace social media because, as you can imagine, it's a whole new way of thinking about your business," Mr. MacKinlay says.

The impact on lenders can include everything from communicating with clients to how they deliver products and even hire employees.

It's very early days yet -most players are still at the state where they're just trying to understand what's going on, but in coming years banks are likely to devote substantial resources to taking advantage of social media and building it into their growth strategies, he says.

This comes as the financial industry is struggling to find growth opportunities in the wake of the financial crisis. Traditional engines such as investment banking and proprietary trading no longer provide the rich profits, whether because of onerous new capital rules or changing market conditions. Even plainvanilla consumer lending is likely to decline as households start to pay down record debt levels. In such an environment, it's no wonder social networking is generating so much excitement.

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