The term “Metaverse” was first used in the novel “Snow Crash”, a science fiction novel written by Neil Stephenson in the Year-1992.
The Metaverse is a combination of ‘meta’ and universe.
This concept of Metaverse creates a virtual world parallel to the real world.
In other words, it is a computer-generated universe parallel to the real world where you can enter as avatars by putting on goggles and earphones and connecting to the terminal.
The Metaverse is not only a virtual world, a virtual space, a virtual reality, a digital and virtual economy, a game, a virtual theme park, a new app store, or a new user-generated content (UGC) platform.
It is a virtual environment where you can go inside instead of just looking at a screen into an endless, interconnected virtual world and communities. In this alternate world people can meet, work and play; using virtual reality headsets, augmented reality glasses, smartphone apps or other devices. It will also incorporate different aspects of online life like shopping and social media.
As per Victoria Petrock, an analyst who follows emerging technology “It’s the next evolution of Connectivity where the user can live his/her virtual life the same way he/she is livingtheir physical life”.
How will banking work in this Metaverse?
To truly realise the possibilities of the Metaverse for banking, one must first understand what is metaverse, and what components make up this digital copy of our current reality.
For reaching there it requires four unique pieces of the box that is technology, platform, marketplace, and commerce. Each one propelled by a distinct collection of ecosystem participants, each of whom has gone through a distinct maturation process. Two sorts of gadgets will be used to create the Metaverse: holographic and immersive.
Holographic devices project digital items into the actual world, making them appear as if they are there. By concealing the physical environment and substituting it with virtual reality, new ways of creating, displaying and interacting with applications, content and experiences.The new technology has transformed the digital experience by bringing together the virtual with users’ sight, sound, and even feel.
Why the bank as well as customers has to experience Metaverse inBanking?
Banking in Metaverse will benefit from a host of new opportunities, delivering immersive User experiences and emotional touch to customers. Metaverse is a new generation technology which is a network of 3D virtual space where people can create, share and explore the virtual world.
In India, on July 08, 2022, Union Bank of India created the “Uni-Verse” virtual Lounge where customers can choose their Avatar to enter the Lounge.
The customers can explore the virtual lounge which is interactive for users and will be able to browse through various schemes and products of the bank.
It will change the User Experience from traditional Mode to Metaverse mode.
In banking, the two aspects are important first is the bank’s customer and the second is money, these two are becoming increasingly virtual hence it is just a matter of time before we see most of the banks have joined the virtual world and now giving services online too. Previously banks and customers were in the physical world .since the customers spend hours a day online so the banks are now online too, If the customers are spending hours a day absorbed in an alternate universe, the banks will follow the trend. They must, after all, they need to be where their customers are now.
The Metaverse has gained traction in a variety of industries, including banking. While advances in hardware and software allow the Metaverse to connect the actual and virtual worlds, it also requires an economic system to thrive.
JP Morgan became the first bank to enter a Metaverse at the beginning of the year 2020. It debuted its Onyx lounge in Metajuku, a virtual recreation of Tokyo’s Harajuku shopping district, on the Decentraland. Its lounge is furnished with a free-roaming tiger and a portrait of its CEO Jamie Dimon.
Whereas in India, Union Bank of India has created “Uni-Verse” a virtual Lounge where customers can choose their Avatar to enter into the Lounge Metaverse, Uni-verse, the bank’s Metaverse Virtual Lounge, will host product information and videos in the initial phase. Uni-verse will deliver a unique banking experience. Union Bank of India has announced the launch of a Metaverse Virtual Lounge & Open Banking Sandbox environment. This initiative is in partnership with Tech Mahindra. The customers can explore the virtual lounge which is interactive for users and will be able to browse through various schemes and products of the bank.
The Metaverse includes general-purpose computers and smartphones, augmented reality, mixed reality, and virtual reality. It will deliver a unique banking experience to customers. Banks used to sell items that were based on real-world elements, but this has altered due to abstract factors such as algorithms. Money can now be created in cyberspace using cryptocurrencies. Generation Y and Z grew up in the world of the internet, but Generation Alpha is maturing in the Metaverse. Metaverse can bring huge improvements in the banking sector, influencing the way banks engage with their customers, and invent new products and new services. The future will depend on how well bankers, designers and security analysts can identify the elements and offer a unique customer experience to future generations while preventing fraud and addressing concerns around privacy and data protection. Metaverse will be the playground for future generations.