Four Ways Virtual Reality Could Change Banking Experience

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Virtual Reality Could Change Banking
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The popularity of Virtual Reality (VR) is growing, and this is largely attributed to the fact that millennials are coming of age. The millennials have been found to be the most likely generation to embrace new technology. Now they have entered their prime spending years, they can afford to spend & invest money in technology that will stimulate change in many industries, including financial services. According to the Millennial Disruption Index – the banking industry has the highest risk of disruption by millennials, this simply means that the Banking industry is the most likely to be transformed by this unique generation.

The potentials of VR in revolutionizing the way we bank cannot be overlooked, as it is capable of providing a totally immersive experience that transforms mundane banking activities into a rich experience that customers can find more engaging. This can significantly improve customer experience, engagement, and advocacy.  Here are 4 ways I believe VR will transform banking experience –

#1. Improved Customer Engagement

What if the customer could consult with his financial adviser virtually? it would give the customer a more personal experience, at his convenience. VR has the potential to significantly improve the customer’s overall experience when it is applied creatively.

VR would also enhance the 1-to-1 marketing, as the customer gets to have a very immersive experience of what using the products or services would be like. (A customer could have the experience of driving away with his new car in a promo material for a car loan service)

#2. Cost Reduction

VR would also significantly improve employee engagement as staff won’t need to travel for meetings or training.  Think of the enormous cost, time and productivity that can be saved when such meetings and training can be held virtually anywhere, in a lifelike setting with information and ideas exchanged easily.

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VR also has the potential to greatly reduce the number of branch employees, as a lot of transactions will be done either via mobile or virtually. The rise of virtual bankers and intelligent simulations is near. A favorite idea of mine is having a personal virtual banker who can share financial advice and tips customized to my unique needs (hmmm).

#3. New Competition

VR could also pave way for a new generation of banks that have very minimal physical locations. Already mobile-only banks such as Digi bank (India) & Sun Trust in Nigeria are in business! A full adoption of  VR will make it possible for a new generation of banks that would operate mainly virtually and via mobile to enter the stage.

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#4. A New Contact Channel

VR as a contact channel will enhance communication between financial institutions and their customers. Customer service calls will no longer feel dreadful, they will take a more personal nature,  as the virtual call agent and customer can see each other – enabling them to read nonverbal cues largely missing in most contact channels currently in use. This will improve communication between the agents and customers, leading to improved customer satisfaction.

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While full adoption of Virtual Reality in the industry is still years away, the truth remains that VR is not just about video games anymore and at some point in the future it is bound to meet with financial services. Some banks such as San Francisco-based Wells Fargo, are already testing how both Google Glass and the Oculus Rift VR Headset could be used by their customers.

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In the end, consumer behavior would determine how much VR will be adopted by financial institutions and other industries in the society, but already market growth is a strong indicator that Virtual Reality is set to continue going from strength to strength. Shipments of VR headsets will grow at an outstanding 99% compound annual growth rate between 2015 and 2020, which will result in a $2.8 billion hardware market up from a $37 million market in 2015.

The future is closer than we think – banks should take the proactive approach to improving customer experience by starting now to consider the potentials of VR and how they can key into the technology with a view to improving customer experience, retention, and profitability.

Kelechi Okeke
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