Most people today equate wearable technology with fitness trackers like Fitbit and feature-rich products such as the Apple Watch. The latter, which is compatible with a growing number of apps and able to handle functionality from text messages to calendar reminders, is now picking up steam in the banking industry. A recent Misys study shows that more and more financial institutions are planning to take advantage of the popular trend by rolling out wearable apps.
The ability to engage customers on mobile devices besides smart phones and tablets represents largely untapped potential for companies in the finance sector. The Misys study found that as many as 72% of banks have wearables on their roadmap for the coming three years. However, only 15% of those surveyed have existing wearable apps or technology that will be ready in the near future – demonstrating a significant gap between those in the finance sector taking advantage of this opportunity, and those only planning to do so.
A noticeable trend is that US and EU-based banks are well behind their LATAM and Asian counterparts when it comes to wearable apps. Of those surveyed, 78% hail from either North America or Europe. The lack of strategy in these places doesn't match demand, however, with approximately 28.1 million smartwatches and activity trackers predicted to sell across the two regions during 2015.
Balazs Vinnai of Misys said "we know that today less than two percent of all sales are conducted via mobile, the stepping stone to wearable technology. It is critical for banks to consider new digital channels as part of an integrated strategy."
That strategy should include proximity payment – which is, according to 66% of respondents, the most attractive capability of wearable technology – as well as better fraud protection and the ability to communicate directly with customers. Understanding customer preferences for wearable app features, and developing the technology accordingly, is a crucial component of any bank's engagement strategy.
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