How IoT, Wearables, and Mixed Reality May Disrupt Banking

Banking Disruption

Technology and finance have always gone together. It takes the best, most secure technologies to keep stockpiles of money safe.

We don’t often consider banking and technology together, but it’s the banking industry that stands to be disrupted most by emerging technologies like the Internet of Things, augmented and virtual reality, and wearable technology.

Whether that disruption comes from established players or new ones is yet to be determined, but it’ll be interesting to watch things take shape.

Changing the Face of Consumer Payments

Millennials are one of the most difficult groups to pin down. Younger generations like doing things new ways, and a recent survey found 73 percent of millennials are looking to Google, Apple, PayPal, and other tech companies for new financial offerings instead of their banks.

It’s millennials that drive the push for mobile, contactless payments. Both established tech and financial companies along with startups like Adyen, TransferWise, and Currency Cloud are rushing to create intuitive ways to use mobile phones for payments.

Now that most major merchants are equipped to handle contactless payments, it’s only a matter of time before you’ll need neither your card nor phone to make a purchase in store. Keychain dongles with timed, regenerating passcodes have long been used to secure financial information on the enterprise side.

Introducing these to the consumer side brings a cryptocurrency level of verification and encryption to mobile payments, and thanks to two-step authentication implemented in popular consumer platforms like Gmail and Steam, understanding of this technology is somewhat ubiquitous.

And it’s not just consumer banking that’s seeing rapid changes.

Evolving the Trading Floor

When the second Oculus Rift development kit was released, Fidelity Labs created an innovative new way for people to view their investment portfolio with Stock City. Instead of stale, boring graphs and charts, each investment is translated into an equivalent building that builds a town. Like Sim City, Stock City requires a carefully planned and executed balance to maintain and grow.

This was just one taste of one direction investment firms are taking virtual, augmented, and mixed reality.

Over the summer, Citigroup released a video showing proof of concept for an AR application that extends the desktop into the real world. It utilizes Microsoft’s Hololens, which, like the Rift HDK2 isn’t ready for the consumer market. Using AR to pull stock quotes, graphs, and other visual data into a 3D world makes it easier to see patterns and optimize trades.

Polish company Comarch is taking things even further. Comarch designed a virtual reality investment newsroom for their wealth management clients. Creating a virtual space gave the feeling of virtually meeting with clients and reviewing their portfolio one-on-one even though it’s in the digital space.

Providing Marketing and Education

It’s not just the financial industry involved in these new technologies. From artificially intelligent chatbots like Taco Bell’s Tacobot helping consumers shop to location-based augmented reality games like Pokemon Go motivating record numbers of people around the globe to get outside and explore, every industry is finding value in the new Internet.

This makes it more important than ever for the financial industry to provide consumers with financial education and other refined services. While using AR to find imaginary creatures, consumer can also locate ATMs, money management services, and more. Not only do customers need to be educated on how to utilize technical aspects of these platforms, but how to pay for them.

Microtransactions, subscription services, and even fraudulent schemes are going to occur using these technologies. Consumers need to be provided with ways to responsibly navigate this new world with all its gadgets and technologies.

These technologies represent new marketing avenues as well. Instead of creating flat, YouTube-style videos, brands can now create immersive, 360-degree experiences that fully engage consumers from every angle. IoT devices like Amazon Dash help you bypass search engines entirely to create a direct connection to customers.

Understanding Emerging Technologies

Of all companies, it’s likely to be Microsoft that jumpstarts the VR revolution. With its announcement in October 2016 that Windows 10 will soon be compatible with its $300 headset, Microsoft is hoping to bridge the gap between consumer and enterprise and make VR as ubiquitous as the flat-screen monitor or smart TV.

The first step to getting started with these new technologies is to explore their capabilities firsthand.

Smartphone-powered VR headsets are available practically everywhere for as little as $10 and as much as $200 while desktop-powered VR starts at around $500. Spherical cameras can be found for as low as $100. IoT sensors, Raspberry Pi and Arduino boards, and development kits are readily available to create smart devices, applications, and experiences. Or just wait for Microsoft’s headset.

Experiencing the technology firsthand helps in understanding the full capabilities. I can spend all day describing to you the feeling of being surrounded by 3D holograms of spreadsheets, databases, and more, but you can’t understand it until you see it for yourself.

So check them out – maybe you’ll see something these other companies didn’t and kickstart your own tech revolution.

By Brian Penny

Oussama El Hilali

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