Hundreds of millions of mobile devices will have augmented reality (AR) capabilities by the end of 2018, Google predicts. The mass adoption of the technology is bound to have a pronounced effect on various sectors. Banking and finance is one of the industries that could see a change in the customer experience by adopting AR.
One more factor is bound to impact the banking sector – more and more millennials are becoming consumers. This generation has expectations and needs that differ significantly from those of predecessors. Millennials are hugely in favor of self-service, a tendency that could boost the adoption of banking AR solutions even further.
These two tendencies will work together to redefine the customer experience in banking and finance. The more pronounced use of innovative technology could ensure quick service provision and accuracy. AR adoption can accomplish a lot more than that.
Banking AR Is Already Here
What sounded like science fiction a few years ago has already become reality. Banks from all parts of the world have already started experimenting with the technology and its multiple possible applications.
The National Bank of Oman has its augmented reality app that enables customers to locate the nearest branch or ATM. Deals and offers can also be uncovered as bank customers walk the streets of Oman and use the camera of their smartphone to bring together their real-life surrounding and an AR projection.
A similar development has been created by the Commonwealth Bank of Australia. Their AR app is a bit more specialized – it targets bank customers looking to buy or sell a home. Augmented reality and rich data come together to provide historical information about property sales, price tendencies, current listings, and properties that have been sold successfully recently. Capital growth trends and other financial metrics are also accessible, allowing individuals interested in real estate to make smart sale and purchase decisions.
Axis Bank from India has its Near Me augmented reality app. The app enables an effortless search for finance-approved properties, ATM locations, and even the best dining offers that the city features. MoneyLion from Utah has launched an AR app called Grow Your Stack. Through the app, users can see a visual representation of the balance in their bank account. A computer-generated image is overlapped onto the real-world environment and the representation itself is 100 percent accurate (due to the fact that the app establishes a connection with accounts in various banks).
This is only the beginning. Financial institutions are known for a bit of rigidity when it comes to offering innovations in customer services. Through partnerships with AR development companies such asIflexion, however, banks and other financial institutions could start adapting to the changing needs of today’s consumer.
Can Augmented Reality Replace the Bank Branch Altogether?
The first steps in the world of AR are somewhat meek and tentative, taking into consideration the potential of such technology.
Some bolder tech developers could be posing a much more loaded question – could augmented reality solutions potentially eliminate the need for brick and mortar branches where customer reps offer services?
The truth is, offices are already shrinking or closing and the industry transition is becoming noticeable.
In the 12-month period that ended in June 2017, 1,700 bank branchesin the US stopped functioning. This is the biggest decline on record, according to a Wall Street Journal report. The analysis also suggests that the decline has continued through the second half of 2017. It’s interesting to point out that many of the big branches that stopped operating were located in big cities and areas characterized by a big number of bank clients.
The reason for branch consolidation and closing is simple – the reduction in customer use of tellers for routine bank transactions. Most of the decisions were based on declining deposit volumes at the respective physical location.
This is a serious shift that’s based on a positive trend. The financial crisis of 2009 caused many banks to discontinue offering services at physical locations. This time around, however, financial sector representatives are thriving. Changing customer demands and behaviors are powering the switch. Statistics show that many bank customers are much more keen on using a banking app than visiting a physical location.
Financial service providers have paid attention to this trend, hence the reduction in the number of physical bank branches. Instead, banks are now focusing on a better mobile experience that often includes augmented reality.
AR Apps Are Just the Beginning – Virtual and Hybrid Branches Will Follow
According to analysts, augmented reality and virtual reality could be utilized to give bank customers tons of autonomy in terms of at-home banking. Hybrid bank branches are also likely to come into existence. These physical locations will make use of AR to enable self-service, chatbots, or robots for the provision of information and live video conferencing capabilities to connect a customer to an actual bank representative upon necessity.
Virtual and hybrid branches will definitely be the future of banking. A whitepaper called The Future of the Branch pinpoints the shortcomings that video conferencing brings to the table (especially when it comes to discussing contracts or clauses). Instead, the authors of the study suggest that virtual reality branches will be much more capable of offering customers what they want.
Visual holograms and projections, the creation of personalized offers that will be displayed onto real-life surroundings, account opening, closing and other transactions could all be handled through the adoption of AR. All of the simulations and projections will be personalized through the use of relevant data and artificial intelligence.
One final point worth mentioning is that such technology could be incredibly beneficial in remote areas and regions that lack qualified banking professionals. Through augmented reality and the creation of hybrid branches, clients in these parts of the world will be given access to a high-quality assistance that’s not affected by the local shortage of human resources.
Adoption isn’t widespread yet but digital technology is changing rapidly and becoming more affordable all the time. It’s really a good idea for banks and financial service providers to get started with adoption right now. The peak of augmented reality is set in the years to come. Having a well-planned and professionally executed service by this time will have a positive impact on customer service, loyalty, and brand awareness.