As if bank branches needed another threat to their existence, a new one could be lurking in cyberspace: virtual reality.
Banks are among a myriad of companies that have been testing virtual reality at a time when some major corporations are starting to roll out products based on the technology. Last month, Facebook began shipping customers its new virtual-reality headsets, the Oculus Rift. Sony plans to release its Playstation VR virtual-reality system in October.
Bill Briggs, chief technology officer for Deloitte Consulting, told me during a visit to Charlotte last week that some banks could start making wider use of such technology by next year. One possibility, he said, is virtual-reality branches, which customers might be able to visit without ever leaving home. Internally, banks could use similar technology to train financial advisers hoping to hone a new sale pitch, he said.
“It’s early prototyping, early experimentation” at this point in time, Briggs said. Banks, he said, are still at the stage of asking themselves, “What would the actual use cases potentially be?”
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“Eighteen to 24 months, we’ll see real examples,” he said.
The financial sector has been analyzing two types of related technology – virtual reality and augmented reality, Briggs said. Generally speaking, virtual reality describes a computer-generated environment in which a person is immersed, such as by wearing a headset. Augmented reality, on the other hand, involves overlaying computer-generated images on the real world (think Google Glass).
Some banks have made no secret about their experiments. Wells Fargo, for example, has tested how both Google Glass and the Oculus Rift could be used by the San Francisco-based bank’s customers.
“We’re looking to re-imagine customer interactions with money within and across channels, including how a customer might use (virtual reality) to manage finances,” Wells Fargo spokesman Josh Dunn said in a statement.
Other banks have said less. A spokeswoman for Charlotte-based Bank of America declined to comment Monday on its plans.
It remains unclear whether virtual or augmented reality could hasten the decline of branches, which banks nationwide continue shuttering as they push to lower operating costs. Rapid consumer adoption of another technology, mobile banking, has contributed to closures of branches, which have seen declining foot traffic.
Briggs says that, ultimately, consumers will also be key in driving the adoption of virtual and augmented reality by banks and other industries.
“Some of the big social networks have invested heavily in virtual reality, he said. “Does this become a new mode of interaction that allows a different level of connection and collaboration? If that’s the case, then I think any industry that has high customer touch, certainly banks, they’re going to be where the customers want to be.”