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Banks Need to Consider Wearable Technology Now

A report from Javelin recommends that financial institutions start looking now into how they can implement wearable technology.

Financial services companies that strive to be innovators should invest now in exploring uses for wearable technology, such as smart watches, Google Glass, and other wearables of the future that will deliver hands-free, voice-activated control, says a new report from Javelin Strategy & Research.

The report, titled "Investing in Wearables for Financial Services – Why Now?," says that while wearable technology is somewhat futuristic, notable financial institutions, technology vendors, and app developers such as Barclays, U.S. Bank, Wells Fargo, Fiserv, and PayPal are already experimenting with wearables such as Google Glass and smartwatches to examine their potential to deliver financial alerts, serve up relevant marketing offers, pay for goods and services, and give consumers greater digital control over their finances.

Further, Javelin recommends that financial institutions not limit their conception of wearable technology to just Google Glass and watches. "To the contrary, companies are experimenting with a wide range of wearables with practical value that one day will entice consumers to buy wearables and lead to the development of financial applications, too," the report reads.

However, the firm notes that the high popularity of smartphones still stands in the way of true widespread adoption of wearable technology. To become pervasive, wearables must prove they are more than smartphone-tethered accessories, says Javelin, and they will only break out when they become hands-free, voice-activated virtual assistants, and reinvent how consumers interact and share on social networks. For financial services, that will be a day when consumers can bank, shop, and pay while walking and driving -- with or without their smartphones -- with unparalleled ease, intuitiveness, security, and privacy, the firm says.

Though the world of wearable technology is still a nascent one, Javelin says financial institutions must commit the resources to support trial-and-error forays into wearable technology that can eventually build future profitability. The biggest potential for wearable technology in financial services, the firm believes, is speech recognition and augmented reality. For example, according to a Javelin survey conducted in September 2013, 53 percent of those polled indicated a willingness to use voice banking, with 23 percent saying they would "probably or definitely" use such capabilities.

Bryan Yurcan is associate editor for Bank Systems and Technology. He has worked in various editorial capacities for newspapers and magazines for the past 8 years. After beginning his career as a municipal and courts reporter for daily newspapers in upstate New York, Bryan has ... View Full Bio

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Becca L
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Becca L,
User Rank: Author
7/31/2014 | 4:58:16 PM
Re: Not glasses, not watches, then what?
LOL. Scarlet Johansen is going to be very busy.
Jonathan_Camhi
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Jonathan_Camhi,
User Rank: Author
7/31/2014 | 4:54:40 PM
Re: Not glasses, not watches, then what?
Joaquin Phoenix is going to be so happy in the future of wearable technology.
Kelly22
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Kelly22,
User Rank: Author
7/31/2014 | 11:27:49 AM
Re: Not glasses, not watches, then what?
Cool info, Bryan. I haven't seen "Her" but it's funny that the tech in the movie aligns with the predictions here. I'd be open to using voice activation for bill pay, email checking, etc. It would certainly help me get things done on time. 
Becca L
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Becca L,
User Rank: Author
7/31/2014 | 11:23:43 AM
Re: Not glasses, not watches, then what?
100% on target.

Byurcan
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Byurcan,
User Rank: Author
7/31/2014 | 11:22:09 AM
Re: Not glasses, not watches, then what?
I did not see it. But according to my mom it's about " a man who falls in love with Siri." Is that accurate?
Becca L
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Becca L,
User Rank: Author
7/31/2014 | 11:21:03 AM
Re: Not glasses, not watches, then what?
Actually, did you see the move "Her" ? It's set in the somewhat near future. The technology leverages voice activation to check emails, pay bills, etc. A combination of an ear piece and hand held device... Seems to have all the elements you wrote about here..

Byurcan
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Byurcan,
User Rank: Author
7/31/2014 | 11:18:47 AM
Re: Trial and Error
It's funny how the modern world turned out compared to what people thought it would be. In Back to the Future part 2, they imagined in 2015 we'd all be driving flying cars. Instead we will all be wearing devices connected to a centralized information network.
Becca L
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Becca L,
User Rank: Author
7/31/2014 | 11:15:22 AM
Re: Not glasses, not watches, then what?
Or turning us into cybermen..



Becca L
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Becca L,
User Rank: Author
7/31/2014 | 11:13:15 AM
Trial and Error
I also find it interesting smart phones are standing in the way of progress in this area. It makes sense that consumers are getting used to carrying an all-in-one devices. Anything that replaces it must be all that and more, so just making small upgrades to a watch or glasses doesn't seem to cut it. That being said, all of the tinkering and trail-and-error is making progress, and we shouldn't be quick to dismiss current offerings on the market.
Byurcan
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Byurcan,
User Rank: Author
7/31/2014 | 11:10:27 AM
Re: Not glasses, not watches, then what?
I'll tell what they're up to: the V-chips that will soon be implanted in all of our brains. It's coming...
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