An exploratory study on the impact of social media of selected commercial banks in the Eastern Cape Province, South Africa

Abstract

Social media have exacerbated negative impact across all facets of commercial banks. The evolution and ubiquity of social media has permeated the unprecedented pressure which is unavoidable in two identified commercial banks located in the Eastern Cape (OR Tambo District, Mthatha) namely: ABSA and Standard Bank in this decade of information technology. Thus, social media have imposed negative impressions on employees’ understanding, thereby resulting in the negative perceptions of employees regarding its benefits and influence which drastically amounted to change of employee interactions and communication. The primary objectives of the study are to investigate the impact made by social media on teams in the banking sector and to ascertain the types of teams who are utilizing social media tools. A quantitative research method was employed whereby 194 questionnaires were distributed and 102 completed, thereby generating a response rate of 53%. The data were analysed using SPSS version 23.0. The results present the descriptive statistics in the form of graphs, cross-tabulations and other figures for the quantitative data that was collected. Inferential techniques included the use of correlations and chi square test values which were interpreted using p-values. This study findings revealed a significant relationship between biographical variables (age, gender, race, level of education, work experience, job category, job type, job level and employer) and five dimensions (understanding of social media, social media optimism, social media influence on human interactions, challenges of social media in banks and perceptions in business etiquette). The study’s findings revealed a positive and significant relationship between social networking as a great contributor to business productivity and that social media, as a medium, enhances communication effectiveness at 0.448** . However, social media optimism was found to be negative due to lack of trust. The challenges of social media have come with embedded risks of fraud, hacking of information and so forth. These impacts were identified as risks which could violate policies and procedures of financial institutions. This study concludes and recommends that branch managers from commercial banks (ABSA and Standard Bank) should formulate and develop policies to guide employees on the use of social media; this is to intensify intervention in the event of inevitable excessive loss in the financial strength of these commercial banks