When banks try the adventure of the metaverse

Posted Apr 28, 2022, 12:00 PMUpdated on Apr 28, 2022 at 5:11 PM

Little by little, the banks are entering the game. Standard Chartered announced this week that it was embarking on the metaverse. The British group has purchased a digital plot on The Sandbox platform, a video game publisher and one of the most used virtual spaces along with Decentraland and Roblox.

“Our commitment will allow us to reimagine the relationship with our current and future customers and to bring new experiences”, commented Mary Huen, the general manager of the Hong Kong subsidiary of the bank, quoted in a press release.

With this initiative, Standard Chartered joins other big names in finance who have recently taken the plunge into the deep end of the metaverse. Even if their intentions remain quite vague at this stage.

The pioneer JP Morgan

JP Morgan opened at the beginning of the year, through its Onyx subsidiary dedicated to cryptocurrencies, a lounge on the Decentraland virtual platform, in which avatars can walk around, admire the portrait of boss Jamie Dimon, but also inform about the bank and its initiatives in the field of blockchain.

HSBC has also positioned itself on the subject by buying a plot on The Sandbox last March. The Spanish Caixa also inaugurated a few weeks ago, via its subsidiary dedicated to digital services Imagin, a virtual café on Decentraland. Korean banks are, finally, at the forefront on the subject.

After the tech giants, luxury brands and clothing brands, it is finance’s turn to take an interest in these new virtual and immersive worlds, which prefigure Web 3.0. For the moment, there is no question of going to withdraw money or to take out a loan in a virtual agency.

French banks in retreat

“Applications are still very limited. The metaverse is currently a laboratory for the few banks that venture there, and is more of a marketing strategy than an industrial reality for the moment”, considers Alain Clot, president of France Fintech. Analysts remain quite skeptical about the growth drivers for the sector.

Some French players are positioning themselves all the same. The fintech Kard, which offers bank accounts for teenagers, has just announced its arrival on The Sandbox. In insurance, AXA bought a plot on the Hong Kong platform in February.

But the big French banks have not yet taken the plunge. “There is a certain reluctance on their part, because they do not see the immediate interest, recognizes Thomas Rocafull, associate director at Sia Partners. It’s a shame because the first mover bonus can be decisive. »

Bank managers are nevertheless attentive to the subject, some have even tested the organization of meetings in these virtual worlds. But without going any further. The risks inherent in this universe, which remains linked to the cryptocurrency environment and remains poorly regulated for the moment, can put off more than one banker.

Perspectives in payment

“As always with deep innovation, there is a learning curve that can take time, nevertheless warns Alain Clot. It is also a way to show its ability to embrace new technologies, new trends and thus attract new talent. »

The pioneers of the metaverse are convinced of this: the development of these virtual worlds will be done with finance. In a recent report, JP Morgan assures that the success of the metaverse “will depend on the existence of a robust and flexible financial ecosystem that will allow users to connect seamlessly between the physical and virtual worlds”.

“In the medium term, we can imagine a new distribution channel with virtual agencies, explains Thomas Rocafull. In the shorter term, banks should have a role to play in payment, as transactions will surge in this universe. They shouldn’t let themselves be overwhelmed. »

In the meantime, the banks have decided to exploit the vein in terms of investment themes. Alongside its arrival on The Sandbox, HSBC is offering its wealthy Asian clients the opportunity to invest in a portfolio of metaverse-related assets. BNP Paribas Wealth Management had also listed the metaverse as one of the five main investment themes for 2022.

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