Technological advancements like augmented and virtual reality have opened many doors in various sectors. For example, in the online shopping industry, these technologies allow customers to try something before buying it, bridging the gap between brick-and-mortar and online stores. The financial sector has also seen huge impacts from these technologies—or technology in general—and that’s what we’re here to talk about.
The increasing technologies in finance, particularly in customer service, have caused traditional banks to start adapting. The finance industry market is becoming increasingly competitive, and this is a result of AR technology.
When it comes to loans, online lending companies are often seen as a preferred option compared to traditional lenders. For example, approval and fund disbursement are fast when you request a loan from a payday loan organization.
That said, some banks now use AR so customers can easily locate nearby ATMs and branches and look out for deals and offers while strolling around a mall. In the UK and Australia, there is also such a thing as a “home finder” app that uses AR technology so potential home buyers can look at the information on houses for sale when they pass them.
Using augmented reality and virtual reality in customer service increases user engagement and satisfaction, leading to a positive brand experience.
As the finance industry continually grows, the data revolving around it is also growing. Both AR and VR technologies make data visualization easier, so companies can organize and visualize large chunks of data faster. This tool is important specifically for traders as it will help them make crucial decisions in managing their client’s wealth.
For example, Salesforce utilizes Oculus Rift to generate a 3D environment to analyze data. Additionally, Fidelity Labs used Oculus Rift technology to create StockCity, a virtual 3D city of stock portfolios where investors can be fully immersed in the data.
Virtual reality payments bring us a step closer to creating the metaverse in its truest sense, and it’s exciting to see this technology unfold. For example, MasterCard teamed up with Wearality, a VR glasses designer based in Orlando. They developed a prototype that enables customers to find an item within Mastercard’s “Priceless,” a VR golf experience, and purchase it without even leaving the virtual realm.
Additionally, the winning team in the last Money20/20 Hackathon held in Las Vegas created a virtual reality mall where consumers can go into a virtual store and make an instant purchase.
Virtual training provides value to both clients and employees in the financial industry. The rollout of new information is also made more manageable, especially in an industry where new technologies are constantly emerging. Avantica, a software engineering company founded in California, found that using AR or VR in training and remote conferences resulted in a 30% increase in information retention compared to traditional methods. These technologies can help learners gain hands-on experiences and understand abstract concepts in a low-risk setting.
In the presence of digital-only and mobile banks, it’s not far from reality that we’d get virtual bank branches as well. Virtual branches can provide a safe, time-saving, and cost-friendly alternative to visiting a bank’s physical branch. The goal is for these virtual branches to be able to offer the same services as a physical branch but solely in a virtual environment.
This experience will be helpful to clients. However, banks will also see value in this in that they can reduce the overhead costs necessary for physical branch locations.
Virtual trading is a type of stock simulator where investors and traders can test-drive a trading platform and practice trading with no real-life consequences. Such systems aim to facilitate learning and familiarity with the tools available in a platform and understand how it works before deciding to do business with them. You’ll be trading virtual money in a real market environment.
Real-life examples of virtual trading platforms are Webull, paperMoney, Paper Trading, and TradeStation Simulator. The last item on the list, TradeStation Simulator, is known among professional traders as it offers all of the features of its trading platform. You simply register online and start trading using virtual money. The platform will then provide you with a report of gains and losses.
When augmented reality is integrated into biometric security and connected with virtual reality, financial companies can provide highly secure and significant protection against cyber threats. Making payments and ATM transactions can be made safer. For example, many mobile banking apps already feature user fingerprint authentication. With AR technology, voice recognition and iris identification are not far from reality.
The use of AR and VR technologies in the finance sector helps reduce customer support costs, enhance user experience, and improve the efficiency of banking services. These technologies have proven beneficial in sales and marketing. When customers know how easy it is to do business with your company, they will continue to do business with you.
Additionally, Millennials and newer generations grew up in a technological world, so they’re likely to be drawn to companies that value and implement such technological advancements. In fact, data from the Millennial Disruption Index shows that 73% of Millennials search for financial products on Apple, Google, and PayPal.
Financial institutions need top talent to ensure they’re providing the highest service quality to customers. To achieve this, banks can use VR technology to show recruits how technologically advanced and innovative they are.
In today’s highly technological era, technologies will continue to evolve and emerge. That said, technologies adjacent to reality, such as AR and VR, continue to become mainstream. These technologies are impacting the way we do business with financial institutions and how they operate and manage data. They also aid in customer acquisition and retention and enhance the user experience. The financial industry, particularly traditional banks, just needs to keep up and evolve to implement these systems, especially since 33% of Millennials believe that they will not need the services of a bank at all in the future.