Financial and banking services are already in the middle of a revolution, and ordinary people have begun spending and managing their money in new and unusual ways. But 5G, alongside other technologies, such as edge computing, AR, VR, and the Internet of Things (IoT), looks set to shift the industry even further, and many commentators argue that most of the changes will show themselves in improved services to end users. People will be able to make payments using wearables, transfer funds in an instant, and talk to their robot financial adviser whenever they want. Here are the 10 major ways we expect 5G to change finance.
1. Financial advice from AI robots
Many financial advisers are already looking into developing robo-advice, an AI driven alternative to a face-to-face service. Robo advisers would act in cases where the advice needed was fairly simple - such as which ISAs a customer can make use of, or how much they need to put into a pension to retire comfortably.
2. Personalised banking
Personalised banking offers much of what an adviser would but need not be offered by one. 5G speeds, low latency and connection with the IoT, is likely to see a proliferation of independent apps offering regular advice to customers as they go about their normal life. It could lead to monitoring of spending habits related to location, suggestions on how to save money at the supermarket, and other nudges encouraging people to put money into a savings bank rather than order a second coffee at the local café.
3. Faster insurance analysis
When an insurance company receives a claim, following a burglary or a fire for example, appraisers visiting the site might wear AR glasses connected to head office that would relay visual information regarding the damage. The appraiser could assess the damage according to directions from an expert at head office. Insurance companies would be able to serve customers quickly, perhaps even immediately. They will also be able to run claims adjustment processes through an AI system, speeding up the resolution of the claim.
4. Wearable technology and banking
Many people are already making debit payments via their 5G phones, and as 5G technology becomes more widespread, wearables, primarily glasses and watches, are likely to be used to manage money. They are different from smartphones, in that they can offer an even more granular view of a customer’s behaviour and health, which may affect insurance offered by banks, as well as purchasing decisions. From a customer identity perspective, wearable technology can analyse biometrics to authenticate customers at any point in time. 5G-enabled AR glasses will help banks present information more simply, such as 3D rendering of interest on an ISA over time. They could also have easy access to customer support through these glasses.
5. Finance apps will move to the cloud
Third-party open banking applications that gain access to the banks’ databases are already widespread (these include Moneyhub, Money Dashboard and Yolt) and banks are competing with their own applications offering a variety of services. 5G will see these move from the customer’s phone to the cloud, with all data processed there. This will mean a user can manage their money using any access point (such as a car or wearable with almost no processing power). This move to the cloud means transactions or services could be aided by virtual assistants in real time, since latency will be so low. This would allow for more complex queries than are currently possible.