The demand for wearables continues to increase as consumers adapt to opportunities for faster and smoother transactions. Wearables are used not only to monitor fitness but also in financial transactions. Retail banks are exploring potential uses for wearables in banking, including facilitating transactions and payments or creating new customer experiences.
What is the potential for the expanded use of wearables in banking?
The various types of wearables have created different types of new engagement models. Banks can provide real-time transaction updates and balance notifications or enable their customers to buy and sell stocks by tapping their devices.
With the amount of wearable tech available, data-driven decision-making is crucial in understanding that banking innovations in wearable technology are worth the investment.
What are the different ways in which wearables can be used in banking?
While wearables currently provide ease-of-use functionalities such as payments, more functionalities will come soon. With wearables, consumers can utilise:
1. Payments – Near field communication (NFC) technology lets consumers pay for food items, retail pieces or facilities by simply putting their smartwatch near a point-of-purchase terminal equipped with NFC.
2. Notifications and alerts – Wearables, especially watches, can give banks the greatest trustworthy customer access. They can receive routine notifications, including a monthly statement or potential overdraft availability. They can tune anti-fraud procedures. Rather than blocking distrustful dealings, they can contact customers in real-time to determine the correct course of action.
3. Inquiries and transactions – Wearables allow customers to make inquiries, transfer funds, and perform other dealings at any location and time.
4. Geolocation features – Wearables can be geo-tracked, allowing banks to usage suitability features like helping consumers find the near ATM. Banks can use less conservative commercial models such as retail firms where the bank opens up its wearable message channel to advertising messages from the retail customers.
How can banks effectively use wearables in the future?
To utilise these opportunities, banks must adopt a data-driven tactic to choose where to attention and invest, the method to navigate regulatory requirements, and the types of consumers to reach. Once a customer requirement has been identified, banks will experience success through in effect business experimentation, exploring various technologies and uses, and testing wearable products. Insights from these experiments could be used to generate a positive response loop, guiding testing and updates as banks work to improve their savings in wearables.
Currently, wearable banking is in its initial stages. Banks that can suggest it will probably obtain a competitive advantage if their offering works well, is easy to use and is safe. Wearables can become very important in banking in the future because of the many benefits it offers.