Over at Technology and Finance, Tom Groenfeldt reports that Gartner is forecasting that in two years, ten percent of all retail lending and financial advice services will go to social banking applications.
Now, if that’s true, its rather a bother for banks everywhere. 10%? That’s real money no matter how you slice it.
We’ve been looking at social applications in financial services for a while now, and the killer problem is that they cannibalise share from the core businesses that banks are in. That makes it rather hard for bankers to structure the right business case to take social applications forward. What we need now is a new way of creating business value in social. We need to find a way for banks and customers to be equal partners in the overall social value equation.
In the meantime, however, this is somewhere we’ve been before. Who ever thought, just a few years ago, that PayPal would be so important? Now, they’re so big (and with a banking licence!) that competitive responses are somewhat limited.
Personally, I think the Gartner forecast is aggressive. That doesn’t change the fact that social applications in financial services are important, and will be getting more so with time. So we’ll need to be certain that our natural tendency to be cautious is balanced with ensuring that we have the right experiences for customers in time.
It does seem to me, though, that banks are becoming less slow in their adoption of new things. Perhaps thats a reflection of being involved in bank innovation, but it’s a good thing, because it is pretty obvious that emergence rate of the new is speeding up.