We do not need Spatial branches, we need a Vision for better banking

Just a year ago there was hype about the Metaverse. Major banks such as Standard Chartered, HSBC, DBS have spent millions acquiring land for virtual brunches in the Metaverse. And JP Morgan even became the first major bank that opened up a lounge in the virtual world of Decentraland. Today everyone is going crazy about spatial computing from Apple Vision Pro.

Will the launch of Apple Vision Pro start the next digital revolution? With the Vision Pro, Apple intends to shift the digital world from mobile computing, in which they have become trendsetters, to revolutionary spatial computing. So I wondered how we could use this new opportunity to create a Vision for better banking in the next generation of financial experience - spatial banking.

Did consumers even need branches in the metaverse? In the case of entertainment or for promoting a brand to a community of users in the metaverse, the idea of a virtual branch is not a bad one. But is it worth millions? I doubt it. Тhis is definitely not suitable as a tool for daily consumption of financial services. The technologies we currently have allow us to provide these services much faster, more conveniently and with better quality. That's why I like the idea of Apple's spatial apps better.

Probably after desktop banking, mobile banking, tablet banking, spatial banking will come. Of course not next year, but it makes sense to take a closer look and start exploring today. After all, the first iPhone came out 17 years ago, but mobile banking at some banks still looks terrible.

Apple Vision Pro: Vision to Reinvent Metaverse

In fact, Vision Pro can become the missing bridge to the Metaverse that blends the real and digital worlds if it overcomes a number of challenges.

• Bring VR/AR technology into the mainstream. After all, the first VR devices went on sale back in the 90s, and, over the past 5 years, more than 100 million VR headsets have been sold, with the leading Quest from Meta selling more than 20 million units alone. But despite this, AR/VR technology has still not gone mainstream.
• Increase the usage cycle and retention rate on VR/AR devices. The problem is that the user experience is too complex, inconvenient and not comfortable for everyday use by most users. Unfortunately, most consumers buy, try, admire and then abandon the device. Only passionate tech geeks use VR headsets on an ongoing basis and 90% of the time for games. The Apple team has set its sights on overcoming this gaming limitation and stick the device into our daily life.
• Implement clear VR/AR interaction principles. Apple called it Spatial Computing, but it needs to be said that, in general, they are reinventing the Metaverse. For the last couple of years, everyone has been talking about the Metaverse, but no one has found an entry. To turn a toy room into the next-gen digital reality, the Apple team built the future vision of clear principles of interaction and functioning of the spatial interface, designed to achieve what other pioneers of VR/AR technology could not.

Once proposed by Apple, the revolutionary iPhone interface for mobile computing became the standard for mobile devices of all brands and platforms, and the Macintosh graphical interface made personal computers accessible and understandable to everyone, not only to programmers. 

And it looks like Apple is once again poised to take humanity to a new experiential frontier ahead of the next digital revolution. Vision Pro is just the first step toward mixed reality, testing technology and user experience. How can the banking industry benefit from this, and what should we consider?

Don't Miss the Next Digital Revolution

When Apple released its first iPhone, no one could have imagined how much it would change the world and what a technological boost it would give. Although VR/AR technologies have not yet become mainstream, Apple's entry into the game could lead to a breakthrough and reinvent the gaming device as a platform for mass use. The capabilities of AR/VR technologies take consumption and interaction with digital content to a new level.

To ensure this next digital revolution, Apple Vision Pro's magical user experience has three advantages that previous generations of AR/VR technology lacked:

1. Mixed reality

• 3D scanning of space by the device allows Vision Pro to naturally integrate digital objects and the user’s environment, creating shadows, highlights and reflections. In this way, users can avoid being suddenly thrown into an unfamiliar or even scary space but can interact with Vision Pro in a safe, clear, and organic way in their home environment.
• Apple seamlessly blends digital content into the space around users by emulating headset transparency. For mass adoption, Apple uses a range of innovations to keep the user connected with the real world, which was missing in other AR/VR devices. 
• Apple achieved minimal latency in the pass-through video experience, the lack of which has led to sensory conflict and caused motion sickness, dizziness and disorientation on other VR devices.
• Apple's desire to integrate the device into everyday life makes using the headset as convenient and fast as possible since it does not require installation of the guardian border every time users dive in, as is the case with other headsets.
• Apple considers connection so important that it simulates the transparency of the helmet from the outside through EyeSight, providing seamless parallel interaction with external reality and giving context to others.

2. Natural interaction

• Existing devices offer controllers the ability to interact with AR/VR content. But, from the point of view of user experience, this reduces the effect of presence from immersion in VR/AR reality and also complicates perception because the user needs three devices to start. Perhaps this has become one of the obstacles to mass adoption of the technology. After all, we are accustomed to the fact that our own body and sense organs are enough for us to interact with reality.
• By creating a digital replacement for reality, Apple provides the most intuitive control using eyes, hands and voice. And again, we remember how they reinvented the phone by solving the smartphone problem in 2007 – getting rid of the keyboard and keeping only the screen. And this control with eyes and hands is implemented in Vision Pro at an incredibly precise level.
• The natural interaction in AR/VR space proposed by Apple is reminiscent of something we have heard before. As Steve Jobs presented in 2007: "We're gonna use the best pointing device in the world. We're gonna use a pointing device that we're all born with – we're born with ten of them. We're gonna use our fingers. We're gonna touch this with our fingers. And we have invented a new technology called multi-touch, which is phenomenal. It works like magic."

3. Mass 3D content

• AR/VR headset is the ideal device for consuming and immersing yourself in 3D digital content. But, unlike everyone else, Apple intends to take 3D content beyond games and integrate it seamlessly into customers' everyday lives. Every element has been crafted to have a sense of physicality. All interface objects have shadows and can be moved like objects in the real world.
• Vision Pro allows the creation of 3D content using the device. Users can shoot their 3D videos and photos, preserving memories or generating entertainment content in the most realistic format. And this will undoubtedly lead to users' massive creation of 3D content. Essentially, this opens a new era for developing the creative economy. And we remember that, because of the lack of 3D content, the 3D television function disappeared a few years ago.
• Spatial immersion of 3D content in Augmented Reality by Apple empowered with the appropriate sound. Apple provides innovative Spatial Audio with true depth-of-sound clarity that makes sounds feel like they're coming from user surroundings. Audio ray tracing analyzes a room's acoustic properties to adapt and match sound to actual space with precise audio mapping.

When all of this will help Apple make AR/VR technologies mainstream, the main question will be whether financial institutions have the competencies to adapt the banking experience to the new age of spatial computing. It is necessary to search, try and experiment to understand what the banking experience of the future will be like. And that’s exactly what the UXDA team did by introducing you to the Spatial Banking user experience concept. We hope that, as always, we managed to inspire the financial industry with our approach to designing next-gen financial products.

Move to next-gen services

Banks need to start thinking today about how to deliver a competitive user experience in the future. Because digital improvements require a lot of effort and time, some banks still provide a 15-year-old digital experience. In which direction should banks move to develop a cutting-edge digital strategy and be able to adapt to the future?

To develop better banking Vision of the future, we have to follow three key principles, which play an increasingly important role in creating the next generation of financial products:

• User-Centric Approach. It is crucial to develop a user-centric culture in financial companies because it ensures services and products align with customers' needs, enhancing satisfaction, trust and long-term relationships. Prioritize user experience (UX) and ensure that digital financial services are intuitive, easy to navigate and provide a seamless flow for customers. Explore and provide a consistent experience across all channels. Gain insights into customer behavior and preferences to offer personalized service.
• Innovative Technology Adoption. Identify and research the most cutting-edge technology trends that enable next-gen user experience. Implement digital identity solutions and biometrics like fingerprint, facial recognition and OpticID. Embrace open banking by using and providing APIs. Implement generative AI for customer support, account management and AI advisory services. Explore the use of blockchain technology and consider integrating cryptocurrencies into your offerings. Foster a culture of continuous learning and adaptability within your organization. Collaborate with Fintech companies, startups and technology providers.
• Social Responsibility. A purpose-driven business prioritizes a broader mission or cause beyond profit, often aiming to make a positive impact on society or the environment. Social responsibility certainly has a positive impact on brand reputation, customer trust and loyalty, as well as employee engagement and motivation. It is therefore important that digital financial services implement and comply with initiatives such as sustainable and eco-friendly practices, community support, serving the unbanked, ESG (Environmental, Social and Governance) compliance, green bonds, sustainable mutual funds and empowering carbon-neutral and responsible consumption. 

Based on my UXDA team experience in designing more than a hundred financial products in 36 countries, there are 3 key steps from which all digital transformations and innovations begin:

Step 1: Review Priorities

Understanding your business priorities is essential to ensure your digital strategy aligns with your overall business objectives. The banking industry is evolving rapidly, and it's important to identify how digital initiatives can support your service growth, customer retention and competitive advantage.

Assess your digital service strengths, weaknesses, opportunities and threats to identify where digital interventions can have the most impact. Listen to customer feedback, conduct surveys and analyze data to determine the most demanding services or features.

Step 2: Define Goals

Ensure your goals are SMART (Specific, Measurable, Achievable, Relevant and Time-bound). For example, increase your mobile service adoption by 20% among millennials within the next 12 months or increase the app rating in the App Store. Focus on digital customer experience enhancing the customer journey, such as reducing response times for customer inquiries or improving self-service options.

Step 3: Define Needs

Assess your technology stack by identifying the gaps in your current IT infrastructure and invest in modern, flexible systems that are needed to ensure digital innovations. Hire digital agency consultants and upskill employees with digital expertise in data analysis, UX/UI design, AI, digital strategy and cybersecurity. Collaborate with Fintech partners to gain access to cutting-edge technology, allowing for faster and more cost-effective digital transformation.

Spatial Banking Experience Should be Based on Apple's Design Principles

To launch a new spatial platform, Apple spent 7 years developing innovative hardware - a powerful wearable computer with unique dual‑chip design, 12 cameras, 6 microphones, 5 sensors, an eye-tracking system with OpticID and more than 5,000 patents. We've already seen some of these innovations in other Apple devices. But it seems these technologies in Apple devices are just being tested for a breakthrough since the Vision Pro took 7 years to create. And if lidar plays a basic role in Vision Pro for mixing reality, then, in the iPhone, it is rather an extra feature for AR apps.

As a result, today, in comparison with available AR/VR headsets, VisionPro is the most advanced device designed to revolutionize the digital market. And probably the most advanced gadget on the planet.

Apple's Spatial Computing has core UX principles and standards that will allow millions of developers to adapt their content for a new platform in the Apple ecosystem. Just as Apple reinvented the personal computers and later became the lawmaker of the mobile era, Vision Pro could usher in a new age of digital interaction.

So, let's look at the principles behind Apple's spatial experience that we should implement into spatial banking:

• Familiar. We have to design windows that live in the user's space and feel like a familiar part of the user's surroundings with glass material for contrast and adaptation to lighting conditions. Spatial banking windows should be moved anywhere and adapted to different sizes, allowing for a comfortable yet dynamic user experience. Well-known gesture incorporation empowers people to effortlessly navigate and engage with spatial banking, ensuring adaptability to various distances.
• Human-Centered. We have to place important content in the center of the user's field of view, utilize wide landscape layouts and extended content for immersive experiences. We should place content along a natural line of users' sight, accommodating different user positions and encouraging comfortable interaction within an arm's reach.
• Dimensional. Spatial banking should be designed to work in any physical space, considering infinite canvas possibilities. Spatial banking will use depth for hierarchy and focus, emphasizing different content and employing scale to provide the feeling of the content. Spatial banking UI will leverage visual cues, like light emission and shadow casting, to ground objects and integrate them into the spatial environment.
• Immersive. Spatial banking UI should be transitioned between different states of immersion, allowing an experience of a Shared Space or a Full Space. Spatial banking should direct users’ attention through motion and visual accents, with smooth transitions for a comfortable and aware experience. We should aim to do more with less by meaningfully integrating content with physical surroundings, using soft edges and adding subtle animations for a feel-alive experience.
• Authentic. We have to ensure more than quick interactions, offering unique and engaging experiences within the user's space. We have to add spatial moments of in-app interactions, enhancing the banking experience with depth and scale. Spatial banking should utilize 3D micro-interactions to make the app distinctive and memorable within the spatial visionOS platform and beyond.

Vision Pro may be exactly the push the Metaverse sorely lacked to boost development. After all, the main deficiency of the Metaverse was not the lack of interaction devices but the lack of mass content and principles of interaction that would provide that magical experience everyone waits for in daily life. According to the first users of the device, the Vision Pro experience cannot be called anything other than magical, especially in comparison with other VR/AR devices.

AI Will Make Spatial Banking Alive

If we talk about the Vision of a better banking experience in spatial computing platform, it will be hyper-personalization powered by artificial intelligence. 61% of customers want personalized recommendations from their banking provider, according to Salesforce Research 2023. And, according to a KMPG survey of 300 executives worldwide, 77% expect AI to have the greatest impact on their business out of all emerging technologies.

Imagine a digital bank of the future. Unlike the traditional one, this future bank will be in constant dialogue with the user and take maximum care of the user's financial life. At its heart will be an AI-powered advisor that constantly analyzes a multitude of data to find the best solutions for the user.

With its static processes and limited user participation, the traditional banking model will give way to the dynamic and proactive approach of AI-powered banking in which the user is at the center. A virtual advisor communicates with the user all the time, providing tailored financial recommendations, personalized offers and timely actions based on extensive analysis of big data and user context. With this level of hyper-personalization, our AI-powered spatial banking will feel alive.

An AI-powered spatial banking app will have a number of advantages over traditional banking that will move the banking experience to the next-gen:

1. Personalization and Contextual Engagement

Customers expect personalized financial services tailored to their unique circumstances and preferences. AI analyzes user data to present personalized offers, promotions and financial products, enhancing user engagement and satisfaction with tailored recommendations.

Traditional banking services often fall short in providing personalized advice, relying on generic recommendations that may not align with individual financial goals. The AI-powered banking adviser, through conversational UI, establishes a continuous and contextual dialogue with users, ensuring that every piece of advice is relevant and specific to the user's financial situation.

This level of personalization is a stark departure from the one-size-fits-all approach of traditional banking. AI will continually learn and adapt to user behavior, ensuring that interactions become increasingly personalized and relevant over time. This adaptive nature will enhance the overall user experience, aligning services more closely with individual needs.

2. Proactive Financial Guidance

Customers seek proactive guidance to navigate complex financial landscapes and identify opportunities or risks. AI banking employs predictive analytics to offer proactive financial advice and alert users to potential issues, offering users a forward-looking perspective on their financial landscape, a capability that the reactive nature of traditional financial services lacks. 

AI continuously analyzes market trends, economic indicators and user preferences to provide automated, personalized recommendations, enabling users to make informed decisions without delay. This proactive approach to financial management minimizes the risk of missed opportunities or delayed responses, contributing to better financial outcomes.

For example, AI can analyze spending patterns and automatically allocate surplus funds into optimized savings or investment accounts, ensuring users effortlessly maximize their savings potential without active management.

3. Real-Time Insights

Customers want instant access to their financial information and insights to make timely decisions. AI-powered banking provides real-time updates on account balances, transactions, investment opportunities and market trends, meeting the demand for immediate and actionable information. 

This up-to-date financial information allows users to make timely decisions based on the latest data and market trends and addresses a common limitation in traditional banking, in which information updates and communication are often delayed.

For example, users receive real-time insights into their spending habits, and AI suggests immediate adjustments for budget optimization, contributing to more effective financial management and savings. 

4. Conversational Interaction

Customers desire a natural and interactive way to engage with their digital financial services. AI-powered banking utilizes conversational UI, enabling users to interact with virtual advisers in real-time, ask questions, seek advice and receive instant responses. 

This shift toward AI banking also introduces a level of user engagement and interaction that traditional banking struggles to match. The conversational UI creates an intuitive and user-friendly interface, making financial management more accessible and less intimidating. 

Users can easily seek advice, inquire about account details or set up real-time alerts on potential issues, fostering a sense of control and transparency in their financial affairs. For example, users can simply ask to be reminded to pay their bill next week via a notification on their smartwatch.

5. Enhanced Security

Customers prioritize the security of their financial transactions and data. AI employs advanced algorithms for real-time fraud detection, surpassing the security measures of many traditional banking systems. AI also analyzes user behavior patterns and transaction data in real-time, swiftly identifying and preventing fraudulent activities to safeguard customer accounts and data, instilling confidence in the safety of digital banking. 

6. Automation for Efficiency

Customers expect quick and efficient resolution of any issues or discrepancies. AI-powered banking streamlines customer support by providing instant responses to queries, automating routine problem-solving tasks and escalating complex issues to human agents when necessary. 

AI banking automates routine tasks, streamlines processes and improves overall efficiency. This automation enables quicker problem resolution, faster transaction processing and reduced manual errors, giving it a competitive edge over the often manual and time-consuming processes of traditional banks.

7. Financial Education

Customers value opportunities to enhance their financial literacy and understanding. AI-powered banking includes educational components, offering insights, tips and explanations to help users better understand financial concepts and make more informed decisions. 

AI banking promotes transparency by explaining financial decisions, fees and terms in an understandable manner, fostering customer trust and loyalty.

AI advice should be provided for each bank product, dashboard and user scenario, allowing users to quickly explore and prioritize tasks. This proactivity of the spatial bank will ensure a personalized user experience, creating a solid base for long-term cooperation between AI-powered bank and customers.

Conclusion

To move forward, we need to build a Vision for better banking from the first principle, and not try to build a digital experience of the future by copying the bricks and mortar of offline branches.

It is unlikely that digital native consumers who are accustomed to checking their balance, making transfers and requesting a loan on their mobile phones in seconds will exchange this for speaking with a digital bank teller in a virtual branch, with virtual coffee and virtual cookies. Maybe in the future a digital consultant in a virtual banking branch could be able to answer complex questions, but it is much easier and straightforward to get instant answer from your financial AI advisor in a banking app on Apple Vision Pro or on any other digital device.

With AI at the heart, next-gen spatial banking interface could become as simple and clear as possible for users. To ensure this, we must reject the traditional route and not build the spatial banking architecture around financial functions and tools. On the contrary, spatial banking should reflect the financial dimension of the consumers' lifestyle experience as much as possible and consider the design principles of spatial computing by Apple.

The future of banking is undeniably digital, and it depends on a proactive and user-centric approach from financial institutions. Some banks have made significant strides in embracing digital technologies and enhancing the user experience, yet the industry is at different stages of readiness for the digital future. 

Of course, it is too early to talk about the need for mass adaptation of banking and financial services to Apple’s new spatial computing platform. However, this potentially revolutionary digital leap could offer users a completely new experience, the design of which makes sense to think about today to expand the horizons of innovation.

Financial organizations that continuously invest in technology, prioritize customer-centricity and adapt to changing customer expectations are more likely to seize new business opportunities and remain leaders in the financial sector. As the digital era unfolds, banks and other financial organizations must commit to ongoing development, innovation and agility to ensure they do not miss out on the potential benefits of the digital revolution.

Explore my vision of Spatial Banking user experience in UXDA case study >>