Increasingly, competition, advancements in technology, and continuous customer demands are forcing the banking and fintech industries to adapt. One way they are coping with this is with a move towards virtual and augmented reality banking (VR and AR). In fact, according to a report by Technavio, the AR and VR market share is expected to increase by $162.71 billion by 2025. These tools, made popular by products like Oculus, Google Glass, and HoloLens, have been on the rise across industries and are now being adopted by the financial sector with great success.
AR and VR are now used in a variety of inventive and engaging ways, from data visualization to strengthening security. Whether working from the office or at home, this technology helps finance professionals integrate with fintech like never before. As a result, a new world where data insights can be experienced, where customers can visualize banking products, and where financial institutions can improve their services is being built.
In this post we’ll explore some of the defining virtual and augmented reality banking trends for 2022.
AR, or augmented reality, overlays a digital layer on top of the real world. In other words, AR creates immersive and dynamic virtual elements that enhance reality. Images, text, and other information are added to the world through a variety of devices, like smartphones, smart displays, glasses, smart lenses, and tablets. Perhaps the most recognizable recent example of AR is the popular Pokémon GO games which saw explosive success.
Perhaps the better known of these two technologies, virtual reality is a broad term to describe immersive, multi-sensory, computer-generated experiences. This state-of-the-art technology allows users to interact with and experience a completely virtual environment with the use of a headset.
Although VR is most well known in the gaming industry, the technology has branched out into a wide variety of other sectors, including real estate, healthcare, telecom, and yes, banking and fintech.
Perhaps the most important aspect of utilizing AR and VR technologies in the financial sector is the visualization of data. Accordingly, advanced AR and VR-backed stock trading and investing has created a way for participants to track and visualize the financial market with greater depth in a three-dimensional and interactive environment.
This has transformed the way financial companies assess their reporting insights. Now, financial information, charts, graphs, and predictions can all take place in a 3D, virtual space. This makes it much easier to draw compelling connections and engage with models to predict better outcomes. Concerned with what an investment product might yield under different economic conditions? Just change the data in the virtual environment, and watch how the world changes around you.
Thanks to the power of virtual and augmented reality banking, financial professionals can explore every data point with more focus than has ever been possible. One powerful example of this is Fidelity Labs’ StockCity. Accessible through Oculus Rift, StockCity simulates the stock market as a 3D city, where users can put on a headset and explore the financial world.
This tremendous shift in data visualization and analysis has evolved the idea of “workplace anytime-anywhere.” Now, users are empowered to work on computers, mobile devices, and virtual rooms to ask advice from virtual agents. What’s more, colleagues and business partners can collaborate and improve their decision making by jointly analyzing critical data.
One example of this is TD Ameritrade’s virtual reality experience. This application starts as a “street view” to teach users about working the stock exchange. From there, it moves to a “helicopter view” of live markets using holography and 3D charts to give real-time guidance.
Finances are rarely simple. But with virtual and augmented reality banking, professionals now have the tools to educate their customers—and employees—on the details of their investment and business projections. This is, again, made possible through the incredible power of virtual data visualization.
An amazing example of this that already exists in the financial sector is Desjardins Bank’s integrated AR platform “Your Way Desjardins.” Delivering applicable and integrated retirement planning and investment advice, the platform is powered by a virtual assistant named Penny. Using interactive videos and data storytelling, Penny helps to educate. She also can make recommendations regarding savings plans to customers in a highly personalized way.
Tools like these are incredibly powerful for creating marketing campaigns that will appeal to clients of every variety.
Educational experiences like “Your Way Desjardins” are just one side of the improvements AR and VR can bring to customer service. These tools offer a variety of benefits, including mobile applications that can help customers find banking branches, ATMs, and financial institutions. This is thanks to augmented reality’s ability to overlay the world with important information. As a result, customers get to experience a simple approach to getting help and advice.
Additionally, many financial institutions have adopted virtual experiences in which a client can seek help entirely in a virtual environment. There, virtual assistants can answer nearly any question with informative visuals and interactive data.
The biggest benefit of this virtual space is that customers can get the advice they’re seeking without ever leaving the house. This has proven to be exceptionally valuable as the COVID-19 pandemic has accelerated today’s digital-first movement.
The way consumers shop has always evolved with the times, but recent events have pushed the changes further than before. And with AR shaping mobile and online payments, daily transactions may soon change even more.
With many companies shifting to a digital-first strategy, AR and e-commerce have become increasingly important. For instance, according to Meta’s AR partner, Vertebrae, retailers that used AR technology during the COVID-19 pandemic saw a 19% increase in customer engagement. Furthermore, the conversion rate among customers engaging with AR rose to an incredible 90%.
Financial professionals should take heed of these trends: embracing AR and VR technology can create major advantages, even during times of economic uncertainty.
Today, cybercrime and the threat of data breaches hang over every online interaction. For this reason, financial institutions invest in protective tactics to maintain the privacy of their customer data. Usually, this means heavily encrypted firewalls and multi-factor authentication. However, these security measures sometimes fall short, frustrating customers and financial professionals alike.
To counter this, some companies have begun to offer AR and VR login procedures that utilize biometric scans of the user’s face or irises to accurately verify their identity. A virtual environment may also utilize voice recognition for secure and easy access to banking. When combined with AR or VR technology, security measures like these provide a smooth and seamless experience. One where all data is kept entirely secure.
There’s no ignoring the impact of virtual and augmented reality banking. Financial institutions of every kind have already begun to successfully implement this technology for purposes like data visualization and analysis, cybersecurity, customer service, and more. However, the list of fintech AR and VR applications will continue to grow exponentially as the value offered by those who utilize it outpaces those companies that do not.
Younger generations, like Millennials and Gen Z, will continue to push businesses to implement modern technology. They will play a critical role in how the technology is adapted and drive decision-making for tech-inspired solutions. Those who adopt AR and VR technologies early will be greatly rewarded for their efforts.