When Decentraland announced the implementation of their First ATM Transak back in August 2022, much criticism led to the expectation that banking in the Metaverse was nothing more than a far-fetched idea, but it turns out this wasn’t the case.
First movers in the banking industry have already begun exploring the Metaverse, creating virtual experiences on platforms such as The Sandbox and Decentraland, let’s look at a few examples.
- JP Morgan – Established the “Onyx Lounge” in Decentraland to communicate with clients and provide them a space to meet. In addition to this, JP Morgan introduced JPM Coin, a coin system allowing participating JP Morgan clients to transfer US dollars held on deposit with JP Morgan within the system.
- HSBC – Bought land in the Sandbox to connect with sports, esports and gaming enthusiasts. The bank will work with sports partners, brand embassadors and Animoca brands to co-create experiences that are educational, inclusive, and accessible.
- Emirates NBD – Emirates NBD launched a global accelerator program for Metaverse startups to enhance customer experiences, positioning the bank as a leader in the next phase of banking innovation in line with Dubai’s Metaverse Strategy.
- Standard Chartered – Standard Chartered Bank announced partnership with The Sandbox on 25th April 2022 to create innovative experiences for clients and the community, allowing the bank to reimagine relationships with existing and potential clients on this new platform.
The Accenture Technology Vision Survey of 2022 found that 63% of global banking executives agreed the Metaverse could bring a positive impact to their organizations in terms of customer engagement and experiences. How?
Banks can benefit from new opportunities and developments, reimagining transactions in the virtual world to:
- Create immersive customer experiences within the Metaverse, allowing for personalized chats with bank agents, virtual finance planning sessions and well-strategized product recommendations.
- Secure transactions through systems like Blockchain, which are secured by high levels of encryption to protect each transaction in a way that’s nearly impossible to tamper with.
- attract younger consumers who have grown up with technology.
- Create virtual bank branches where banking products can be sold to these younger consumers.
- Utilize the first mover advantage by establishing a presence on virtual platforms, providing a competitive advantage.
The way banks and financial institutions have been experimenting with this new technology represents an opportunity for testing the possible enhancement of customer journey – leading to a new dimension in the banking industry. However, considering the ethical concerns of data privacy and digital security, the question arises on how banks can guarantee the trust of their clients in this virtual world.
What about you – would you feel comfortable to do banking in the Metaverse?