Metaverse For Banks and Financial Institutions
Updated On : Jan 2023
What is Metaverse?
The metaverse is a shared virtual space created by the convergence of virtually enhanced physical and digital reality. Metaverse is facilitated by the use of virtual reality (VR), augmented reality (AR), head-mounted displays (HMDs), flexible work styles, an AR cloud, IoT, 5G, and artificial intelligence (AI).
Metaverse is considered to be a new frontier technology. Although it is still in a nascent stage, many industries like gaming, media, entertainment, banking, and fintech have rapidly started using this evolving technology.
Metaverse can address the consumer pain points of the banking and financial sectors. With the help of the metaverse, banks that currently do not function 24/7 due to higher operating costs can open or set up virtual branches and provide their services to customers anytime, anywhere.
The following are some examples of use cases in the banking and financial sectors:
- Creating customer engagement activities
- A customer experience can be created by foreign banks for their HNIs.
- The banks can offer services like checking the balance, paying bills, transferring money, and transacting using AR and VR channels.
- The smooth and seamless customer onboarding process, by creating community bonds among new joiners and corporate start-up groups.
- Virtual branches help to provide high-touch services for the clients who are looking for mortgages.
- Showcasing real-time analysis when reaching prospects for new investment products
- Launch digital asset issuance by developing digital assets of banking products for its customers
The metaverse market is expected to become a $5 trillion market by the year 2030. Adopting the metaverse will help the banks to showcase themselves as tech-savvy organization.
Some of the banks that have started adopting Metaverse are as follows:
- Bank of America has launched a virtual reality training program for around 4,300 financial centers
- BNP Paribas is also contributing to the development of virtual reality
- Union bank of India launches an open banking sandbox environment and metaverse virtual lounge.
- JP Morgan Chase launches Onyx Lounge
Benefits of adopting Metaverse:
- Enhanced customer and employee experiences:
With the help of AR and VR, banks can provide a 3D experience to their customers for transactions and virtual banking, as well as seamless customer onboarding for bank employees.
- Customer Engagements:
Banks can improve their marketing and branding activities to improve customer engagement by providing personalized services to customers virtually.
- Launch new innovative products and services:
Metaverse will help to develop many innovative products and services like digital assets, digital payments, etc.
- Gain a competitive advantage:
Adopting metaverse banks can create their presence on platforms like Sandbox, which will help them gain a competitive advantage.
- Boost marketing and branding:
Metaverse will help banks to increase their brand value and attract the younger generation’s interest in digital assets, digital currencies, etc.
Metaverse will assist banks and financial institutions in providing their customers and employees with an immersive experience.
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