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Social Media is Banks' Next Frontier for Customer Service

Banks are increasingly embracing social media for customer service.

With the enormous popularity of social media coupling with consumers' willingness to interact with companies through these websites, banks have begun experimenting with using Facebook and Twitter as means for

With the enormous popularity of social media coupling with consumers' willingness to interact with companies through these websites, banks have begun experimenting with using Facebook and Twitter as means for providing customer service, according to a new report.

Conducted by Javelin Research, a study into banks' use of social media revealed that many are now embracing various platforms. However, the firm's analysts also pointed out that the right approach to such practices is necessary in order to deliver effective customer service.

"As [banks] begin to participate in social media channels they need to be prepared to allocate sufficient resources to address and resolve consumer issues," Mark Schwanhausser, the senior analyst for Multichannel Financial Services at Javelin said.

Last year, according to the report, some banks experienced first hand the backlash they can endure through social media because they weren't prepared.

Among the most notable of these events was Bank of America's attempt to impose a $5 fee on its customers. However, the response was quick on Facebook and Twitter with the negative reactions eventually forcing the company to abandon the proposal.

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