The rise of wearable banking

FEATURE: INNOVATION
The rise of
wearable banking
Wearable technologies are setting tongues wagging across the globe, quickly
become a must-have for many consumers. Paco Alvarez finds out about the
impact these technologies are having on the retail banking industry.
W
earable technology
is not an isolated
phenomenon, but
part of the larger
wave of the ‘Internet of Things’,
with a potential economic impact
of up to US$6.2 trillion annually
by 2025, according to McKinsey.
Traditional uses are for mobile
industrial inspection, maintenance and
the military. Consumer uses include
display peripherals, computer-ready
clothing and smart fabrics. And banks
are starting to take note.
Google Glass is one technology that
has great potential for banking. The
Minority Report-like technology, which
is scheduled for launch late this year,
combines a camera, projector, battery,
Bluetooth, and Wi-Fi connectivity,
along with GPS and voice recognition.
Head mounted, it displays information
in a hands-free format, allowing the
user to communicate with the internet
via natural language voice commands.
Ukraine’s Privatbank has already
demonstrated the possibilities of this
Efma Journal No. 244
technology in banking. In a video
it made last year, the bank showed
how customers wearing Google
hi-tech specs will be able log into
their accounts, make payments,
conduct video calls with a personal
banker and even open the door to
their local branch using simple voice
commands, glances and gestures.
One step ahead
Spanish Bank Banco Sabadell has
created the first end-to-end Google
Glass app, allowing users to consult
its ATM network and be guided to the
nearest cashpoint using an integrated
GPS system. The app also allows
customers to check their current account
and hold video-conferences with the
bank’s contact centre 24/7. According
to Pol Navarro, head of digital
channels and innovation at Banco
Sabadell, Google Glass “is perhaps a
prime exponent of the new evolution
the internet is about to experience. The
mobile internet’s natural evolution will
be living services. Users will want to
be able to interact with firms through
many different devices and as quickly
and intuitively as possible. And we’ve
already started to adapt ourselves to
this scenario”.
Xavier Marin, head of digital
services strategy at the bank, also
has confidence in banking via
Google Glass. “In the future it will
be possible to walk up to an ATM
wearing the technology and simply
say ‘Please give me money’. It’s likely
that future releases of Google Glass
will allow iris-secure identification,
providing numerous opportunities for
development,” he says.
CaixaBank, meanwhile, has
developed an application for Google
Glass which adapts two of the most
frequently used CaixaBank services on
conventional mobiles: a branch finder
based on augmented reality and
a currency convertor. The currency
converter runs calculations when the
user activates the application and
focuses the glasses on a product’s
price tag. The equivalent amount will
appear superimposed on the screen
using augmented reality. The service
allows users to choose any input and
output currencies in the world.
But Google Glass is far from the
only wearable technology solution that
is making headway in the industry.
As smartwatches become increasingly
popular, we’ve seen a number of
solutions that embrace them for
banking. New Zealand’s Westpac, for
example, ported its balance update
app to the smartwatch. And Intelligent
Environments has created a solution
for the Pebble smartwatch which sends
customers a vibration alert when they
near their overdraft limit.
Caixabank has developed an app
for the SmartWatch 2 from Sony
which allows users choose stocks and
indices from international markets and
follow them on their smartwatches.
The watch will display recent price
information for each stock and index,
as well as fluctuations since the start
of the market session. Should users
want more detailed information,
selecting the stock on the smartwatch
screen will automatically open the
CaixaBank stock market application
on their mobile device, displaying full
information for the selected stock.
A wearable future?
While the first steps in wearable
banking have already been made,
there are a number of questions
that remain. In a recent blog post,
Standard Chartered Bank’s head of
digital banking Aman Narain said
that banks have some important
challenges to address, not least the
new breed of risks introduced by
wearable tech. “It was only last month
that we saw a network of hacked
devices including a fridge send spam
emails to 750,000 unsuspecting, and
clearly bewildered, recipients,” he
said. “Clearly, this type of issue would
be unacceptable in banking. Creating
appropriate security standards for the
Internet of Things is necessary and
will take time.”
With this in mind, Narain said that
over-estimating the near future of the
Internet of Things may be dangerous
and expensive. “However, I believe
its long-term implications for financial
services are profound. We’re about to
hit another massive shift in technology
– a shift that will give rise to new
companies, and kill or cripple those,
including banks, that fail to adapt. If
you don’t believe me ask anyone who
used to work in a bookshop or in the
record industry.” n
Paco Alvarez is digital communications
manager at Cecabank.
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