As metaverse banking continues to disrupt some of today’s core industries, it seems that its influence has expanded into the banking system. Technologies such as XR (extended reality) aren’t new, but with the metaverse going mainstream, researchers anticipate that it will soon enough be worth $8 trillion.
Due to the pandemic, consumers today go online for gaming and shopping, boosting global revenues that in 2021 exceeded $154 billion. Beyond gaming, nobody can predict how fast the metaverse will continue to expand. In banking, the FOMO phenomenon is heavily accentuated. However, there needs to be a balance drawn out between trends and reality. How can the metaverse influence the banking industry? Read on to learn more:
From basic Metaverse banking functionalities to immersive 3D experiences
As we move beyond 2D environments, the metaverse can enable the banking system to provide better, more immersive 3D experiences to their customers. By 2030, 47% of modern bankers agree that AR (augmented reality) and VR (virtual reality) will become key transactional channels. Recently, BNP Paribas launched a virtual reality application that enables customers to use VR headsets to open a banking account and make financial transactions.
From a branding experience, the metaverse plays a vital role in improving employee experience as it has the potential to drive more relevant interaction with a bank’s customers. The Bank of America, for example, deployed VR training programs for its 50,000 workers; the aim was to simulate various customer service scenarios and help branch employees adjust their behavior in order to provide superior customer support.
Building emotion and strengthening connections with banking customers
Although the banking system has everything it needs to provide modern, advanced services and products, it’s an emotionally detached industry often ruled by bureaucracy, stringent rules, policies, and regulations. In the metaverse, banks will have the chance to be more human and connect with customers on a much deeper level. It’s also an opportunity to target a younger generation of customers who is more technology-savvy.
Banking customers of the next generation will visit virtual metaverse branches to get access to state-of-the-art services and products. They’re also able to conduct transactions much easier with blockchain technology already widely adopted in the metaverse. South Korean bank, Kokomin, already uses employee avatars to streamline customer connections and enable access to customized, superior financial services.
Developing new markets and building new products
With the rise of NFTs, blockchain, and cryptocurrencies, people are starting to trust that there’s real value in digital assets. The metaverse economy is growing, meaning that banks can now leverage new opportunities to lend and insure their customers with cryptocurrencies, virtual real estate, and NFTs. However, a decision has to be made as to whether the financial system, in general, is plagued with bureaucracy and outdated policies.
An ongoing battle between traditional banks, neobanks, and cryptocurrency exchanges is underway. It remains to be seen what role the metaverse banking phenomenon will have. What we know so far is that modern financial institutions are eager to virtualize customer interactions to provide better services, such as virtual ATMs that allow cash withdrawals.
Increasingly more banks are seeking to target modern consumers who understand the NFT market, and the metaverse is the perfect realm for people to collaborate and partner up. Whether it will be for trading virtual assets or buying digital assets, banks are rushing in to strengthen their presence in the metaverse to strengthen and expand their customer base.