Making The Banks Metaverse Ready With Virtual FinTech
Posted By : Priyansha Singh | 20-Jan-2023
How To Make The Banks & FinTech Industry Prepare For The Metaverse?
The banking industry is one of the primary sectors that has been largely affected by new waves of digitalization including the ever-evolving Web3 and the metaverse. Just like in the real world, this virtual world encloses financial services where people can transact, own, and lease digital assets. It encapsulates exciting opportunities for banks and financial institutions to furnish payments, investments, loans, and insurance to fuel the metaverse economy. However, the possibilities do not end there – this highly realistic and immersive digital realm also provides banks with the potential to put humanity and emotions back into banking.
For instance, the meaningful and empathetic conversations that people had in the past have been long lost, along with much of customers’ trust and reliance on banks. In addition to the massive potential for service and product innovation, the metaverse is an opportunity to restore the interactions that have been lost in digital channels. It will help in creating memorable experiences for new-age banking users.
In this blog, we will discuss how metaverse services have transfigured the banking and FinTech industry and how businesses in this sector can navigate the immersive virtual world for optimum benefits. So, let’s get started.
The Need For Making Banks & FinTech Business Ready For The Metaverse
In this new phase of Web3 and metaverse progression, everything has evolved from a disparate collection of applications and sites into a persistent 3D environment where moving from work to social platforms is as easy as walking from the office to a restaurant bar across the street. Apart from the user experience of inhabiting a virtual realm with a sense of presence, the emerging digital transformation technologies make it feasible with a data framework that generates scarcity, veracity and even trust.
There are two segments that FinTechs are prioritizing in the metaverse:
- Firstly, enabling banking customers to virtually meet, interact, and communicate with bank staff as well as invest, transact, and purchase various banking products.
- Secondly, experimenting with the gamification of financial services to augment customer engagement.
Evaluating The Opportunities That The Metaverse Furnishes To Banking & FinTech Industry
According to a recent report shared by JP Morgan, it is estimated that the business and market opportunities for companies in the metaverse will hit more than $1 trillion in yearly revenue in the coming years. In another Zion Market Research study, it is predicted that the metaverse market is anticipated to grow at a CAGR of 39.5% and touch $400.5 billion by the year 2028. Tech giants and digital platforms are already gearing up to embrace metaverse services and innovations, which will altogether have five billion users with an economy of $13 trillion by the year 2030. Moreover, the digital infrastructure of the metaverse is already preparing for everything, from real estate to eCommerce which will facilitate elevated online shopping experiences and retailer/brand partnerships.
The metaverse wallet is functionally identical to the current digital wallets provided by banks and financial institutions. The only difference is that metaverse wallets can be used to store digital assets including non-fungible tokens or NFTs. Such wallets can be used to carry out financial transactions in a way similar to your real life. For instance, it can be used to trade, buy, and sell products, such as virtual real estate, digital art, e-commodities, in-game assets, unique tokens, and more on the metaverse platform. Apart from this, it can also be used for transferring or receiving tokens between users within the expansive metaverse.
Metaverse Use Cases In Banking
Although metaverse development services hold massive potential for the FinTech segment by answering a multitude of customer issues, however, the banking institutions that have already stepped inside this domain are gaining a strong foothold. To help you understand this in a better way, here are some of the prominent use cases of the metaverse in banking.
- J P Morgan: They have launched an Onyx lounge in the Decentraland metaverse where they facilitate financial assets creation, cross-border transactions, safekeeping, payments, and trading.
- Standard Chartered: The bank has also acquired real estate in the form of a land parcel in Sandbox, which it plans to utilize for experimenting as well as formulating new experiences for users within the metaverse.
- HSBC: They have invested in the Sandbox metaverse and have purchased a plot that will be developed for engaging with sports and gaming fans.
- Siam Commercial Bank: They are officially the first banking group that has built their headquarters within the metaverse - The Sandbox. The entire space is equipped with three primary zones:
- Virtual Land: A space for partnered businesses to collaborate and connect over project development tasks.
- Virtual Hub: A space for knowledge sharing and hosting events.
- Hub: It helps in promoting local artists through virtual concerts, NFT marketplace, and NFT gallery.
What Are The Benefits of Metaverse In Banking?
As compared to the traditional banking sector, the metaverse in banking is encapsulated with a myriad of opportunities and benefits. Benefits that do not just drive user engagement and impact immersive experiences but also open up new avenues for financial operational models.
- Reinvent existing employee and customer experiences using 3D and AR/VR technology
- Engage with customers in new ways including personalized interaction
- Invent new financial products and services that are digital yet feel hyper-real
- Facilitate secure digital payments, create & trade digital assets, use digital twins, etc
Looking For Metaverse Development Services For Your Business?
At Oodles Technologies, we provide metaverse development services for businesses across a wide range of industries including real estate, banking, FinTech, education, eCommerce, healthcare, and more. As an established metaverse development company, we enable enterprises of all sizes to navigate the operational challenges within the virtual realm and establish a solid market presence powered by gen-generation technologies including AR/VR, blockchain, NFTs, edge computing, and artificial intelligence. If you are looking for metaverse development solutions for your project, feel free to drop us a line. Our experts will get back to you within 24 hours.