IMPACT OF ELECTRONIC WORD-OF-MOUTH ON CONSUMER FINANCIAL DECISION-MAKING AND ENGAGEMENT IN DIGITAL BANKING SERVICES: EVIDENCE FROM AN EMERGING ECONOMY

Abstract

The increasing use of social networking sites (SNSs) has significantly transformed the way consumers exchange information related to products and digital financial services. Electronic word-of-mouth (e-WOM) has emerged as an important communication channel through which consumers share opinions, experiences, and recommendations within their social networks. This research investigates how major social relationship determinants affect consumers’ participation in electronic word-of-mouth (e-WOM) and explores their impact on financial decision-making and involvement in digital banking services in Pakistan. The study specifically examines how homophily, tie strength, social capital, trust, and interpersonal factors shape consumer participation and interaction within communication activities on social networking sites (SNSs). The results indicate that homophily, social capital, trust, and interpersonal influences significantly affect consumers’ engagement in e-WOM activities, whereas tie strength does not show a significant relationship. The findings provide insights into consumers’ online communication behavior and its influence on financial decision-making in digital banking services and offer practical implications for marketers and financial institutions seeking to utilize e-WOM strategies on SNSs to strengthen customer engagement and develop sustainable consumer relationships.