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Metaverse and Fintech

The word Metaverse is making highlights in last few months. Many leading organisations have created metaverse environments or become part of one.

Metaverse is an immersive Digital environment (Virtual World) where you can interact and transact. For e.g. Visiting a virtual mall and making purchases, attending an event / conference, Gaming etc. So, may use cases across different Industries are possible.

You must be wondering; how different it is now to Online Experience today? As these things can be done even now, remember Second Life (been there for over 10 to 15 yrs). Well, the difference this time it seems is, in form of Immersive and rich 3D Experience. As a device, these are empowered by AR & VR Headsets which have become little more affordable. All this getting accelerated with 5G and above bandwidth and Web 3 also comes into play gradually. Then there are usual suspects of DeFi, Crypto’s, NFT’s etc. which are getting bundled. But, my intent is just to give an initial intro, highlight the difference and move on to the main issues viz. Problems & Challenges and How metaverse can be effectively used.

So, let us quickly look at some problems & challenges w.r.t Metaverse

  1. Standards – With multiple metaverses emerging, there is no standard for interoperability between metaverses. This impact communities being Islands
  2. Identity (Especially Digital) will be a big issues including Avataar’s etc. This ecosystem is not well developed yet
  3. There are various Privacy & Security concerns, and few recent incidents have only reinforced the same. So, there is need for a well thought out and enabling set of regulations.
  4. We are not fully there yet as we need 5G & Web 3. 5G has just started, and true decentralised Web 3 is few years to be realised.
  5. Just like Identity, Interoperability Standards etc. we need Secure Payments which is Native to Metaverse. There is good scope for CBDC type Digital currency too in metaverse.

Well despite the above challenges, which limit the effectiveness of Metaverse for mass public. There is still good scope to use metaverse effectively for many specific use cases in Financial Services & Fintech. In fact, starting with these use cases will gradually enable a robust Metaverse Ecosystem which can be extended for mass usage. Let’s look at these.

  1. Training – Scenario’s can be developed over Metaverse and this can be used for training of employees on skills like Selling, Negotiations, Trading, Customer service, compliance etc.
  2. Relationship Management – Relationship Managers can make use of Metaverse for interacting and advising their clients. This can gradually be moved to a Virtual Branch experience.
  3. Gamification – Metaverse can be used for gamification, especially to engage with the younger generation.
  4. Marketing – Banks can use Metaverse to organise curated campaigns & events for their target audience.

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This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author.

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