How Do Cultural Differences Impact International Banking Practices?

At first glance, it is normal to think that cultural differences do not affect international banking activities. So, don’t you think that daily habits, life choices and other elements of culture affect our consumption patterns? Since our consumption patterns are also an important factor of the economy, we can claim that cultural elements affect the economies of countries and therefore cause us to see different results in international banking practices.

For example, depending on the working hours of a country, the consumption patterns of citizens depending on their level of welfare, and how conscious they are about economy and finance, this country’s financial relations with other countries are greatly affected. This situation requires banks or financial institutions operating on an international scale to be more flexible by offering local solutions.

What Cultural Factors Influence Banking Preferences?

international banking

Cultural factors deeply affect the banking preferences of both financial institutions, businesses and individuals. Cultural factors include family perception and structure, relationship with money, risk tolerance differences, social acceptance and consumption habits. Each of these factors is an important element that can redefine financial needs.

For example, when a society has a special month or period due to religious beliefs, we can see its direct effect on spending habits. Citizens’ banking preferences increase during religious holidays due to the need to spend more. This requires financial institutions operating on an international scale to follow the calendar of that culture by offering local solutions.

Different consumption habits can be observed in different geographies. Even climatic conditions are an important factor in banking preferences. Differences that deeply affect the ways we spend money lead to different banking patterns for different regions. If taking out a loan is known as a prohibited transaction or a sin in a country’s culture, banks serving in that country need to develop strategies by being aware of this phenomenon.

How Does Cross-Cultural Communication Affect Global Banking Transactions?

Today, different countries and societies interact with each other in much more ways than in the past. As technology and communication channels develop, become faster, easier, faster and cheaper, different cultures interact more intensively with each other. This redefines the banking needs of the globalizing world.

It is also possible that there will be some disagreements in the financial transactions between different cultures with different understandings and languages. For this reason, developing a common language and mutual tolerance is also important for financial matters.

Establishing correct communication with different institutions of different countries that engage in commercial contacts will be beneficial for both businesses and individual investors. In this way, there will be fewer misunderstandings and problems in the global banking transactions process.

Today, a problem in one country affects the whole world due to high interaction and development of travel options. The global epidemic in 2020 may be one of the best examples of this. An incident that occurred in China caused the whole world to recreate its financial dynamics.

What Are The Challenges Of Adapting Banking Services For Different Cultures?


Countries around the world have cultural differences from each other in many areas. While taking out a loan is a sin in some countries, banking law is different in some regions. While in some regions consumers are more willing to spend money, in some regions spending money at certain times may be perceived as a wrong behavior. Such specific situations require financial institutions or banks to know well the local dynamics of the region they serve.

Banks should create teams to eliminate language barriers for the region they serve and offer special strategies by being aware of local dynamics and consumer expectations. In this way, consumers can have a more efficient financial journey by developing direct solutions to their financial needs.

One of the biggest challenges in adapting banking services to different cultures is the process of understanding the dynamics of this culture. At this point, consultants who have knowledge of the dynamics of the region can be used. In this way, banking products or services are suitable for local conditions, which enables more successful banking.

Can Banks Promote Cultural Diversity And Inclusion In The Industry?

Increasing and accelerating communication options and more practical travel conditions have enabled different cultures to establish greater contact with each other. This caused different cultures to experience more impasses and disagreements. Finance units also have some responsibilities to solve the problems arising from such cultural differences and to be more inclusive.

Banks can offer strategies that address the cultural differences and richness of different societies with the financial products or services they develop. A peaceful financial ecosystem can be created by taking advantage of the different characteristics and riches of different societies.

This will both increase the number of potential customers of financial institutions and provide an equal and fair financial ecosystem by eliminating incompatibilities arising from cultural differences.

Are There Cultural Considerations In Sustainable Banking Practices?

I have said that some cultural elements should be taken into consideration in order for banking activities and services to be sustainable. If banks fail to successfully integrate cultural considerations with their own service concepts, they cannot provide accurate banking services to the institutions and people in the region they serve.

Applying international banking service standards in a market with special conditions may make sustainable service impossible. It is necessary to provide customized services and solutions to different markets containing different cultural elements. Banks that implement this successfully strengthen their reputation. There are various financial institutions that aim this perspective on their operating areas.

It is important for financial institutions that aspire to become a strong banking figure in a market to consider cultural differences and elements throughout the entire process. Developing special campaigns for Ramadan in a country where the majority of the population is Muslim or presenting Christmas campaigns for a Christian community are just a few of the countless examples.

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