RBC's augmented reality payments rely on a human touch

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Banks are still in their experimental phase of using virtual and augmented reality to interact with customers, and the key to their success will be embracing the technology's social nature.

And sometimes that means making an app designed for non-customers.

The Royal Bank of Canada is integrating augmented reality — a technology that overlays a digital interface over the real world — into peer-to-peer payments and digital gifting. RBC eGift, which is currently available in the App Store, lets users send money via Interac and virtual gift cards. Though RBC also uses AR in its banking app to help customers find ATMs, the eGift app is meant to be available as a separate experience.

“The reason that we do it in an app is that we want to make sure that we provide the best experience as possible for the consumer,” said Eddy Ortiz, RBC's vice president of innovation and solution acceleration. “Imagine if I had a great experience sending it, but when you receive it you’re not able to visualize it in the same way or it doesn’t work. We have to take care it end to end.”

As VR and AR technologies have evolved, they have become increasingly social. Oculus, one of the companies at the forefront of consumer VR, is a unit of Facebook, and has integrated the social network with many of its VR apps. For example, consumers watching a concert or comedy show in VR on the Oculus Venues app can link their Facebook account and find out which of their virtual seatmates share the same interests.

In RBC's case, the AR gifting technology is meant to be used face-to-face, adding a personal experience to the somewhat impersonal practice of sending a digital gift card.

"It basically allows you to be immersed and put a lot of thought behind what you’re doing,” Ortiz said. “I can think about it as: 'Hey Siri send my wife $100 for our anniversary' or something, she’s going to be upset.”

Through the RBC app, the recipient receives their gift from a virtual helicopter controlled through AR. This feature was added in June 2018; the eGift app launched without AR in August 2017.

“So now you send the gift and when the person receives it … they’ll have to guide the helicopter through to the landing pad,” he said. “When the helicopter lands, the gift opens.”

Augmented and virtual realities’ usefulness will be key to bankers who want to maintain the personal touch of the branch experience even as consumers demand more digital interactions, said Raja Bose, global retailing banking consulting leader at Genpact, a global professional services and consulting firm.

In a recent Genpact consumer banking report, the firm asked 6,287 consumers globally about their banking experiences. Though many customers weren’t fully on board with banks’ experimentation in digital technology, the firm predicted the trend to shift.

Generation Z and millennials report higher levels of satisfaction with digital banking than baby boomers, according to the report. Twenty-seven percent of people aged 18-34 prefer mobile apps, compared to 6 percent of people over 55 years old.

In regards to augmented and virtual reality, Bose said new technologies are seen as a novelty, but as technology matures and banks find ways to make it useful, it could become indispensable.

Virtual reality could replace physical experiences, Bose said, such as going to a branch. It also has a way of making intangible ideas in banking, tangible.

“You can’t touch and feel a checking account, or an investment account, so to the extent of VR that can make those intangible things feel ‘realer’ I think that VR may be useful in that context,” Bose said.

Bose stressed that artificial intelligence is the foundational technology for augmented and virtual realities, and helps present them in a compelling way. He also mentioned that if banks want to become more innovative with new technologies, they could partner with other institutions.

Banks could work with car dealerships, for example, and use VR or AR to showcase a car and have options for a preapproved loan, Bose said. In that case, the dealership would build the VR and AR capabilities, and then partner with banks, he added.

“It’s a very promising technology,” he said. “I think that banks and financial services and institutions are probably in the early experimental phase right now, which is let’s throw a couple of things out there and see what works and see what people like and see what they don’t like.”

RBC has received positive feedback on its eGift app, though it is refraining from doing extensive marketing of it until the bank can perfect the experience, Ortiz said.

In the next six months, Ortiz wants to create a tighter link between client activity to merchants. He also mentioned adding a social aspect to e-gifting so after sending a gift, friends can see their recipients' reactions.

Augmented reality is easier for RBC to develop then virtual reality, Ortiz said. VR is still not accessible to everyone — headsets are required — so AR can have a greater reach (while there are AR headsets, the effect is more easily achieved via smartphone screens).

“AR is not going to change banking, but it’s going to change many ways of how people interact,” Ortiz said.

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P-to-P payments Virtual reality Augmented reality RBC Canada