Metaverse and fintechs: a new world that’s only beginning

With new technologies like blockchain, 5G and Web3, the metaverse is growing exponentially day by day.

Companies like Microsoft, Meta (formerly called Facebook) and Google are investing huge amounts of money in this new virtual reality experience that promises to change the way we see and live life.

One of the main areas where the metaverse is leaving a footprint is the fintech industry. In this article, you’ll understand the main implications of this phenomenon. But first, let’s start from the basics.

What’s the metaverse?

The metaverse is a new revolutionary idea driven by technology that interconnects different digital spaces and experiences. This environment allows, among other things, to interact with other users and devices and also make transactions.

From playing a game to attending a concert or going to a retail store, the metaverse allows real life events in a 3D experience. In order to access the metaverse, the user needs to have AR & VR headsets - which, by the way, are becoming more affordable -.

The technology that supports the metaverse is blockchain - which allows easier and more transparent tangible and intangible transactions - and Web 3. This last technology is a new version of the World Wide Web, where the network is decentralized. However, Web 2 is also used in the metaverse. There, the users have more freedom to create and share information and have a wider interaction with others.

According to experts, the metaverse will allow people to connect in a different way but also make businesses grow. That’s where the fintech industry comes in and has a huge impact in this world.

The metaverse in the fintech industry

The fintech industry is definitely starting to invest in the metaverse. Some traditional financial institutions are experimenting with the metaverse within the Web 2.0.

Some of the most common activities that traditional banks and investment companies are doing are employee training, investment advisory services and interaction spaces.

For example, in 2021 Bank Of America launched the first virtual reality training program in more than 4.300 centers across the United States. There, more than 50.000 employees received virtual reality training to simulate interactions with clients and practice their skills.

On the other hand, more fintechs are interacting with the Web 3 metaverse. The company Sokin will accept full e-commerce payments through the metaverse. How? They will have a 3D community of retailers, and their users will be able to purchase through this platform.

What's next?

There’s no doubt that what we’re currently seeing in the metaverse is only the beginning.

And fintechs are no exception to this. This is probably because fintech’s main values, such as democratization, are also present in this virtual world.

It’s really likely that most fintechs will migrate to virtual reality and offer payments and transactions there. Also, more and more traditional financial institutions will start experimenting with training and interactions with clients through the metaverse.

However, some issues like cybersecurity will have to be taken into account in order to assure data protection at all times.