The majority of retail banks have not embraced social media platforms, which could be putting them in a precarious position with their customers, according to a recent report.

With fragile consumer confidence, social media could be used as an important tool to engage with customers, according to market analyst Ovum, author of the report.

Nearly two-thirds (60 percent) of the world’s retail banks don’t have any plans in place to use social media, according to a statement. There are only 6 percent of retail banks using social media to deal with customer queries and only 1 percent believe it will be using it in this way between 2011 and the end of 2012. Only 14 percent of banks are currently using it for marketing, with 12 percent planning to use it to promote their business by the end of 2012.

"We feel that this attitude from retail banks towards social media is a major issue in an era of aggressive competition," said Ovum analyst Martha Bennett. "The banks without a social media strategy are being shortsighted and are placing themselves in a dangerous and vulnerable position compared to competitors who have realized that social media can and must play an intrinsic role in their business."

Bennett added: "Consumers are not averse to receiving promotional messages via social media, or using it for customer service enquiries so a massive opportunity to rebuild the confidence in the sector that is so desperately needed is being ignored."