October 19, 2022
Do you recall your first visit to the bank, entering a branch and opening an account or getting your first card? Now imagine that experience in a virtual realm. Today's digital-savvy generation seeks a virtual journey with banks, and the metaverse is providing that immersive virtual world to you.
What does metaverse mean for banks?
As a growing number of individuals spend time in the metaverse for their business needs, the demand for the provision of convenient banking and financial transactions has become evident. Users prefer seamless digital experiences today, which means avoiding physical interactions with institutions. This further necessitates personalized user experiences and drives the need for innovation in products and services.
Moreover, in this "phy-digital" era, customer-centric products and service innovation is paramount. Banks that have already embraced digital practices will find it easier to adapt to the unique characteristics of banking in the metaverse. The metaverse can overhaul customer relationships and be integrated into growth strategies as a means of fostering sustained engagement through interactive digital channels and seamless delivery of banking services.
How can banks benefit from the metaverse?
As the metaverse is gaining momentum, it has presented significant market potential for the banking and financial services (BFSI) industry. The market size for the Metaverse is estimated to reach USD $800 billion by 2024, with the financial services sector projected to grow to a whopping USD $50.37 billion by 2026. This creates vast opportunities for banking institutions, some of which are discussed below:
Curating a new virtual market segment
Tech-savvy customers prefer banks that offer the latest digital services. In the case of metaverse, the concept of having every banking activity virtual will help you retain such clientele. JPMorgan Chase, for example, has established a lounge and office in the Metaverse, allowing customers to consult with avatar advisors. This approach helps banks expand their market share in the Metaverse.
Augmented customer journeys
The metaverse enables the virtualization of banking and financial services, allowing their customers to perform various activities remotely. From cash transactions to everything related to your banking activities, the Metaverse enhances convenience and eliminates the need for physical branch visits. Several banks, including HSBC, Standard Chartered, Siam Commercial Bank, and Caixa, have already embraced the Metaverse.
Developing new banking products/services
Banks can transform their relationships with customers as it will help them switch from traditional marketing mediums and hence, necessitating the curation of new offerings. For instance, Sumitomo Mitsui Banking Corp. partnered with HashPort to enter the NFT industry, attracting a diverse audience to their banking institutions and driving business growth.
The metaverse is becoming a reality now
The metaverse is no longer just a concept and its implications can be seen across the world in every facet now. As the metaverse economy expands at an unprecedented pace, the banks are presented with a unique opportunity to experience rapid growth. A lot of Industries have already embraced the metaverse, and now banks need to determine their role and seize this chance to expand their nexus.
If you want to know more about the metaverse and its solutions, please contact our experts to fast-forward your business growth through disruptive digital solutions.