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Augmented reality combines the real world with virtual elements to create immersive experiences. Initially popular in gaming and entertainment, AR has rapidly expanded into the finance sector offering innovative ways to interact with financial services.
Banks and financial institutions are increasingly leveraging AR to provide customers with real-time financial data and personalized experiences. Studies suggest a significant uptick in AR adoption within the next few years, indicating a transformation in how financial services are consumed.
What Is Augmented Reality In Finance?
Many fintech companies are already utilizing AR to create more interactive and engaging customer experiences. For example, through AR-based apps, users can visualize their financial portfolios in real time or explore complex financial products with ease. AR enables a more personalized approach to financial advice. Clients can interact with virtual advisors who guide them through personalized financial scenarios based on their specific needs and goals. Real-time data visualization through AR helps clients understand their financial status quickly and more comprehensively, enabling better decision-making.
Market Overview Of AR In Fintech Or Finance
The integration of augmented reality into the financial and fintech sectors in the USA is rapidly reshaping the landscape and ushering in a new era of innovation and growth. With the global AR market, including fintech applications, reaching a valuation of USD 57.26 billion in 2023 and projected to surge at a staggering CAGR of 39.8% from 2023 to 2030, the potential for transformative change is immense.
Looking ahead, the trajectory only accelerates, with forecasts indicating a leap from USD 93.67 billion in 2024 to a monumental USD 1,869.40 billion by 2032, reflecting a remarkable CAGR of 45.4%. Within this dynamic arena, North America, particularly the USA, plays a pivotal role, accounting for USD 20.02 billion of the AR market in 2023.
In parallel, the fintech sector in the United States is experiencing its own surge, with a market size surpassing USD 4 trillion and boasting a robust CAGR of 11% over the forecast period. Digital payments emerge as the vanguard, commanding a market value exceeding $1.2 trillion and solidifying their status as the primary driver of fintech innovation.
These statistics underscore the profound impact of AR on the evolution of the fintech landscape in the USA. From enhancing customer experiences to streamlining operations, AR technologies are fueling a shift towards more immersive and interactive financial services, setting the stage for a future where the boundaries between physical and digital realities blur seamlessly.
Top 10 Benefits Of AR In Finance
Here are the top 10 benefits of augmented reality in finance:
1. Enhanced Data Visualization
Augmented reality (AR) offers financial institutions a powerful tool for visualizing complex data patterns in real time. By overlaying data onto physical environments, AR enables analysts to comprehend intricate data flows and make informed decisions quickly.
2. Immersive Virtual Trading
Financial firms are transforming trading into a virtual reality experience through virtual reality trading workstations. By integrating VR with asset management software, users gain improved access to trading algorithms and techniques, building a more immersive and efficient trading environment.
3. Virtual Payment Experiences
AR is revolutionizing the payment process by creating virtual shopping environments. Collaborations like MasterCard’s partnership with AR enable users to make purchases seamlessly within virtual environments, enhancing convenience and engagement.
4. Interactive Payment Solutions
Innovations such as Visa’s AR app, which overlays food location heatmaps onto real environments, offer users an interactive payment experience. Users can explore nearby establishments, place orders, and make payments directly through the app, building personalized interactions and real-time engagement.
5. Enhanced Security Features
AR can integrate biometric security measures into virtual environments, strengthening consumer trust and confidence. From behavioral biometrics to iris detection and facial recognition, AR enhances security measures for accessing banking services, conducting transactions, and ensuring secure payments.
6. Innovative Banking Applications
Financial institutions like Axis Bank are pioneering the use of AR for Aadhaar-based verification and real-time branch and ATM identification. AR applications enhance operational efficiency and customer convenience, driving the adoption of innovative banking solutions.
7. Interactive Finance Education
AR-based virtual training programs offer a dynamic and engaging platform for educating both staff and clients on financial concepts and industry developments. By incorporating immersive experiences into training initiatives, financial institutions can enhance learning outcomes and deepen client engagement.
8. Improved Customer Support
AR enables financial institutions to provide enhanced customer support through augmented reality apps. Users can locate nearby banks and ATMs effortlessly, enhancing convenience and accessibility for clients. Additionally, AR apps facilitate property inspections and provide detailed information to clients in real estate transactions, further enhancing customer experiences.
9. Innovative Training And Recruitment
Financial firms can leverage virtual reality technology to showcase their innovative and technologically sophisticated environments to potential recruits. VR-based training initiatives offer a cost-effective and immersive platform for staff development, ensuring high-quality service delivery and talent acquisition.
10. Cost Savings And Efficiency
AR and VR technologies offer cost-saving opportunities for both emerging and traditional banks. By replacing physical branches with AR/VR banking experiences, financial institutions can reduce operational costs while providing a seamless and immersive banking experience to customers. Additionally, AR/VR facilitates remote meetings and training sessions, reducing travel expenses and enhancing operational efficiency.
Top 19 Use Case Of AR In Finance With A Brief Case Study
Here are some exciting use cases of augmented reality (AR) in financial services, along with financial institutions at the forefront of this innovative technology:
1. Visualizing Investment Performance
AR technology allows investors to visualize investment data in a more immersive manner. By pointing their phone at a company’s billboard, users can see an AR overlay displaying stock charts, news articles, and analyst ratings. This can be helpful for on-the-go investors to make informed decisions based on real-world context.
UBS’s “Financial Compass” concept app demonstrates how AR can be used to provide investors with relevant financial data when they point their phones at a company’s logo or building. It utilizes AR to display relevant financial data (stock performance, analyst ratings) when a user points their phone at a company’s logo or building. While a publically available app isn’t available yet, UBS’s concept demonstrates the potential of AR in investment visualization that can help investors make informed decisions.
Moreover, Salesforce is in the process of developing a tool for analyzing financial data using AR technology, employing Oculus Rift headsets. This tool will enable users to interact with financial data in a three-dimensional virtual environment, providing a more immersive and intuitive experience.
2. Interactive Budgeting & Financial Planning
AR apps can create a 3D model of your finances, making it easier for you to understand your spending habits and budgeting goals. Point your phone at your budget and see your spending habits categorized and visualized in real time. This allows for a more intuitive understanding of your finances and goal tracking.
Westpac New Zealand’s AR banking app allows customers to view 3D bar charts of their account balances and transaction history, while the Yolt budgeting app uses AR to overlay spending data onto a calendar, helping users visualize their cash flow and identify areas for improvement. Users can categorize transactions and set goals directly within the AR interface. Yolt’s app is a successful example of AR simplifying financial planning.
3. AR-powered Loan Applications
AR can streamline the loan application process by allowing users to view potential loan options and payment estimates instantly. For instance, while buying a car, you can use your phone’s AR features to instantly see potential loan options and monthly payment estimates overlaid on the car you’re interested in. This streamlines the loan application process and empowers informed financial decisions.
While there aren’t widespread AR loan applications yet, financial institutions like JPMorgan Chase are exploring AR for various purposes, including potentially integrating it with loan applications in the future.
4. Interactive Insurance Claims
AR technology can guide users through the insurance claims process by highlighting damaged property, providing repair cost estimates, and even connecting you with approved contractors.
Insurance providers like State Farm or Allstate may develop AR apps to streamline the claims process and improve customer experience. Apart from this, Allianz’s AR Insurance Claim Filing App is a prime example of how AR can streamline communication and enhance the claims experience for policyholders. It allows policyholders to file claims by using their smartphones with AR features to capture images and videos of damaged property. This streamlined the process and improved communication.
5. Personalized Financial Coaching
Virtual financial advisors can use AR to project personalized goals, budgeting tips, and investment recommendations directly into your surroundings. This interactive experience can make financial planning more engaging and accessible.
Cetera explored using AR glasses to provide remote financial advisors with the ability to project relevant data and charts onto a client’s environment during consultations. Cetera’s pilot program demonstrates the potential of AR for personalized financial guidance. Moreover, Investment firms like Vanguard or Fidelity are also exploring AR to offer remote financial coaching sessions with a more immersive advisory experience.
6. Augmented Reality Security Features
AR can enhance security measures; its authentication methods, such as facial recognition and biometric authentication, can provide secure login experiences for online banking. This adds an extra layer of security to financial transactions.
While not widely implemented yet, banks like JPMC and Citibank are considering integrating AR for secure mobile banking experiences within their mobile banking apps. Additionally, financial institutions like Bank of America have also expressed interest in exploring AR for security purposes, potentially utilizing facial recognition or iris scans, while Mastercard has integrated iris authentication into its AR shopping experience to ensure secure and seamless payments. Similarly, Axis Bank has adopted AR technology with Iris Scan for Aadhaar-based transactions, enhancing customer security and accessibility.
7. Fraudulent Activity Detection
Credit card companies utilize AR for real-time fraud detection, notifying users of suspicious transactions with AR overlays for immediate verification and highlighting a suspicious location or merchant where their credit card might have been used fraudulently. This proactive approach to fraud detection enhances security, protects users, and allows for immediate verification and potential account freezing before any unauthorized charges occur.
Credit card companies like Visa and Mastercard could utilize AR for real time fraud detection, notifying users of suspicious transactions with AR overlays for immediate verification.
8. Virtual Branch Tours & Onboarding
Financial institutions can create virtual tours of their branches using AR, allowing potential customers to experience the layout and services offered remotely. This can be especially useful for geographically dispersed areas or those seeking a more interactive onboarding experience.
The National Bank of Oman has implemented AR technology to assist customers in locating nearby branches and ATMs, thereby improving customer service and accessibility. Additionally, Desjardins Bank has introduced an AR app called “Your Way Desjardins” to offer retirement planning guidance and tips, offering a convenient alternative to traditional in-person consultations.
9. Interactive Retirement Planning Tools
AR can visualize retirement scenarios, helping users understand projected income streams and future expenses overlaid on a timeline. This allows for a more engaging and informative approach to retirement planning.
Retirement planning companies like Fidelity and Charles Schwab could develop AR-powered tools to make retirement planning more accessible and impactful or integrate AR features into their retirement planning tools for enhanced visualization.
10. AR-powered Investment Research
By pointing their phones at products, investors can access AR overlays displaying sustainability ratings, ethical sourcing practices, and social impact reports alongside financial data. This can encourage investors to make informed decisions based on their values alongside financial data.
Socially responsible investing platforms could leverage AR to provide investors with additional data points related to ESG (Environmental, Social, and Governance) factors. Moreover, companies like PixelPlex are developing AR platforms for comprehensive investment research, empowering investors to make informed decisions aligned with their values and financial goals.
11. Gamified Learning For Financial Literacy
AR apps can create interactive games that educate users about budgeting, investing, and other financial concepts. It can help manage virtual finances, make investment decisions, and face real-world financial scenarios in an engaging format.
Non-profit organizations like the National Endowment for Financial Education are exploring ways to collaborate with game developers to create AR-based financial literacy games aimed at young adults.
12. AR-powered Portfolio Management
Using the phone’s AR camera, users can scan their investment portfolios with AR to visualize asset allocation, risk profile, and potential returns. This can provide a more intuitive understanding of your investment portfolio and allow for easier adjustments.
Investment management firms like BlackRock and Vanguard may integrate AR features into portfolio management platforms for enhanced visualization, allowing investors to track their investments and make strategic decisions.
13. Virtual Product Demos For Financial Products
AR can be used to showcase financial products like credit cards, insurance plans, or mortgages, providing interactive demonstrations for users. This technology-integrated app, when pointed at a credit card, can help you see an AR overlay displaying its benefits, rewards program, and eligibility requirements in an interactive format.
Fintech startups like Chime and SoFi are exploring the concept of leveraging AR for more engaging product presentations within their mobile apps.
14. AR-assisted Tax Preparation
AR apps scan your receipts and tax documents, automatically categorizing them and highlighting potential deductions or tax credits. This can streamline tax filing processes and reduce errors.
Tax preparation software companies like TurboTax and H&R Block might integrate AR features for simplified tax filing, enabling users to navigate the complexities of tax preparation with ease.
15. Personalized Customer Service & Support
AR technology can be used to help customers visit a bank branch with assistance using an AR-powered avatar. This virtual assistant could answer questions, provide personalized financial advice, and guide them through available services.
Major banks like Bank of America and Wells Fargo could explore using AR avatars in their branches to enhance customer service experiences and provide personalized interactions, catering to tech-savvy millennials and improving overall customer satisfaction.
16. Bank Account Management
While customers may routinely check their account balances, they might require assistance in comprehending the significance of their financial data. Augmented reality (AR) aids in visualizing information in three-dimensional space and presenting objects in proportion.
Westpac New Zealand’s AR-enabled app allows users to visualize their account information through three-dimensional bar charts, including balances, transaction history, and spending locations. This innovative feature enhances the user experience by providing a visually engaging way to manage finances.
17. Online Payments
With advancements in AR technology, traditional payment service providers are increasingly implementing integrated solutions to enhance the efficiency and timeliness of order processing.
VISA Europe has collaborated with Blippar to create an AR shopping and payment experience, enabling customers to make purchases by simply pointing their smartphones at products. This seamless and convenient payment method enhances users’ online shopping experience.
18. Virtual Trading
The trading sector has embraced augmented reality, enabling traders to share insights and conduct meetings through AR-enabled workstations. Financial institutions are exploring the integration of AR into trading rooms to facilitate interaction with intricate datasets and remote collaboration with clients.
Citigroup has introduced a virtual trading desk equipped with Microsoft HoloLens, enabling traders to interact with complex financial data sets in augmented reality. This immersive platform enhances collaboration and decision-making among traders, leading to more informed investment strategies.
19. Targeted Customer Acquisition
Research has revealed that attributes such as perceived ease of use, curiosity, social influence, and product features hold significant importance for digital banking among Generation Y and Generation Z.
This underscores the importance of integrating augmented reality (AR) into banking to cater to the evolving needs of future customers. Millennials and upcoming generations, who represent potential customers, have been immersed in a technology-driven environment from a young age and are inclined to expect similar innovations from the finance sector.
Failure to adapt to this technological disruption poses a significant risk to the finance industry. Utilizing AR and VR in finance can empower teams to maintain relevance and attract more customers by improving ease of use, enhancing user experience, and optimizing efficiency.
The Future Of Finances With AR
Augmented reality (AR) is on the verge of revolutionizing finance by offering immersive data visualization. Complex financial information will be transformed into clear, 3D overlays, enabling everyone to grasp investment opportunities or company performance with ease. AR can also improve trading by recreating past market conditions for deeper analysis and informing future strategies. Furthermore, AR has the potential to bridge the financial literacy gap by making abstract concepts interactive and engaging, building a more financially informed society. As major tech companies pave the way for AR adoption, the financial sector stands at the precipice of a transformative era. By strategically incorporating AR, financial institutions can unlock a future of empowered investors, informed traders, and a financially literate society.
Conclusion
Augmented reality (AR) is set to transform the financial sector. It offers several use cases, from visualizing investment performance in 3D to strengthening security and revolutionizing financial education. By seamlessly blending the virtual and real, AR empowers investors, streamlines decision-making, and promotes engaging learning experiences. As AR technology matures, forward-thinking businesses that embrace it will gain a significant edge in delivering innovative solutions and shaping the future of finance.
How Can Idea Usher Help You Develop An AR Solution In Finance Or Fintech?
Idea Usher stands as your ideal partner, pioneering the integration of Augmented Reality into fintech solutions. Our expertise lies in crafting immersive experiences that not only captivate but also streamline complex financial processes. With a deep understanding of AR technologies, we bring your financial services to life, offering interactive and engaging user experiences. We recognize the uniqueness of your business needs and provide tailored AR applications that align with your strategic goals. Connect Now For Free Consultation.
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FAQ
What is AR, and how can it be used in finance?
AR, or Augmented Reality, supercharges our physical world with digital information. It is like using your smartphone or tablet to view interactive 3D graphs representing your investment portfolio’s growth or see company financial data layered on top of real-world locations where they operate. AR can transform static data into a dynamic and engaging experience.
Are there any security concerns with using AR in finance?
Security is paramount, especially when dealing with financial data. Financial institutions implementing AR solutions will need to prioritize robust data encryption and user authentication measures to ensure the safety and privacy of sensitive information.
What is the future of AR in finance?
AR is still in its early stages, but the potential for innovation is vast. We can expect to see a surge in creative applications that transform how we access and manage our finances. From personalized financial planning tools to interactive investment simulations, AR has the power to reshape the financial landscape entirely.
How can I get started with AR in finance?
The first step is to partner with a fintech development company that possesses expertise in AR technology. They can guide you through the possibilities and help you craft a customized AR solution that addresses your specific needs and unlocks the full potential of this exciting technology within the financial sector.
