How 5G Will Change the Banking Industry
2020 will surely be remembered for a lot of things. From a global pandemic to growing social movements, 2020 has presented enormous obstacles as well as opportunities for those that rise to the challenge. For financial institutions, one way to take advantage of these opportunities for transformation is through 5G. Some experts estimate that within five years, more than 80 billion terminal devices will be connected to the 5G network. In June 2020, Industrial and Commercial Bank of China and China Mobile jointly released the white paper, “Banking Innovation in 5G Era,” which focuses on the innovative application of 5G banking and highlights how creating a 5G customer experience could be the primary application of the technology.
While some banks have begun to explore customer experience design using 5G, people still have questions about the transformation that 5G would bring to bank service and customer experience. What new financial needs will arise in the 5G era? Will people still need go to bank branches? What do branches have to do to attract customers? Having worked on numerous design and strategy projects within the banking industry, SLD has come up with three predictions that are destined to materialize in the 5G era.
Exponential Growth in Mobile Banking
5G technology enables many key Fintech features such as high volume, instant response, stability and security. 5G mobile banking will also be able to manage many transient, high-speed financial needs in places such as city centers, retail malls, football fields and festivals. If your bank could proactively incorporate 5G design in customer experience, it will be better prepared to address challenger tech firms (such as Facebook) that have ambitions to disrupt the banking industry.
Micro-Banks Will Be Everywhere
Because 5G technology can handle large traffic in dense spaces, we will likely see more and more integrated, mobile and micro banking devices in crowded places such as event spaces. Connected to the 5G network, the next-generation intelligent ATM-like devices will have highly integrated functions and use technologies such as AI-assisted self-service, contactless interface, facial recognition and e-signature. It will merge scenario-specific needs with financial services and quickly occupy undiscovered spaces where physical banks were not possible in the past.
AR/VR Will Revolutionize Customer Experience
5G high-speed transmission plus cloud computing will have a revolutionary impact on AR/VR applications. It is imaginable that in the future, branches in remote areas will be able to use VR to cast images of customer service representatives. While this will change the role of financial consultants, quality service will still be a key in creating a truly inclusive banking experience.
The marriage of technological innovation and business models has the potential to breed a new ecology, one that creates new needs that were not previously available. These can then be transformed into new revenue channels through customer experience design. What 5G really affects are the scenarios and interactions that happen between banks and their customers. Only those banks that embrace innovation and deploy proactively can take the lead in 5G transformation, harvesting the added-value and cash flow brought by the new technology.