Lenders turn away from social media

Ryan Bembridge

October 12, 2016

technology man phone laptop tablet

Mortgage lenders are surprisingly using social media less than two years ago, IRESS’ Mortgage Efficiency Survey has concluded.

IRESS found that just half (52%) of lenders are active or considering using Twitter compared to nine in 10 (90%) in 2014.

And it’s a similar story with Facebook and LinkedIn, with 55% and 36% currently active or considering using them compared to 80% and 50% in 2014.

December more important than in previous years

Henry Woodcock, principal mortgage consultant at IRESS, was surprised by the findings at a time when social media is booming.

He said: “In other areas of financial services, for instance banking, social media is transforming customer relationships with the likes of American Express using social media to personalise its message and tailor its service to individual customers.

“Developments are also moving beyond customer service and marketing to new services such as Turkey’s Denizbank Facebook banking; reducing operational costs and creating new business models

“While we do not envisage customers applying for mortgages via social media in the near future, tools such as Twitter and Facebook can provide useful additional channels for customer service and information pre and post completion, particularly in reaching the under 45 age group.

“With several digital lenders set to launch in the coming months, we believe lenders across the market will need to better understand social media and develop plans on how to use it effectively.”

Daniel Hegarty, chief executive of ‘digital mortgage broker’ Habito, said: “I’m not sure what’s changed in the past two years – maybe lenders felt it wasn’t generating enough benefit.

“When you’re proud of your product you want to step up and engage with your customer through any channel you can.

“When you know your product isn’t everything you want it to be, you tend to keep your head beneath the parapet to avoid drawing criticism in a public forum.”

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