UBS and Julius Baer essay offering wealth advice in the metaverse

Two of the world’s top wealth managers are experimenting with transitioning client meetings from oak-panelled boardrooms to the Metaverse, but are struggling to overcome data security and motion sickness.

UBS and Julius Baer, ​​Swiss banks that specialize in providing high-end financial advice to billionaires, have each tested the use of clunky headsets and pixelated avatars to interact with customers, according to those involved in the research. .

But neither bank is set to roll out a virtual reality offering for its ultra-wealthy customers after the experiments raised concerns about the ease of use of the technology and the ability to share documents online. completely safe.

“The technology isn’t there yet – frankly, it looks like Atari graphics at the moment and people who have tried it have gotten motion sickness,” said a bank executive involved in the trials.

“We also have a lot of problems with the security of confidential and sensitive data.”

The Metaverse is an immersive virtual world where people wearing headsets interact with each other as three-dimensional avatars.

It’s been championed by the likes of Mark Zuckerberg, the founder of Facebook, which rebranded as Meta last year and angered investors for its heavy spending on virtual reality.

Wealth management is one of the latest professional services to be disrupted by digitalization as the ultra-rich value personal interaction with their advisers when discussing their investments.

But some wealth managers have started investing heavily in technology in recent years to ensure they are prepared for changing demands.

Since becoming chief executive of UBS, the world’s largest wealth manager, two years ago, Ralph Hamers has prioritized investments in digital technology to reduce costs and differentiate the group’s offering of its competitors.

“We will use digitalization and all the opportunities it offers to provide personalized advice, and will use digital technology to tailor that advice to customer needs,” Hamers told shareholders at the bank’s annual general meeting this year. year. “It’s not a matter of one or the other: customers decide what they want, and our job is to deliver what they want.”

Hamers had pursued the use of artificial intelligence in wealth management through a $1.4 billion acquisition of US advisory firm Wealthfront, but UBS called off that takeover in September.

A person involved in UBS’s virtual reality trials said the bank is trying to find ways to improve the digital meetings it already has more and more with its clients.

“We did some experiments,” they said. “We set up virtual offices in the metaverse, we tested how to interact with customers, different ways to play with it, what does it look like, what does your avatar look like, does that really help us.

“We’re not there – it’s still a lot of experimentation.”

UBS has already trialled the use of augmented reality technology to allow staff to recreate a trading floor environment while working from home during the pandemic.

Swiss bank Julius Baer has also pledged to invest heavily in technology over the next few years and has experimented with virtual reality.

The bank ran a 12-week pilot for a group of employees to hold internal meetings in virtual spaces, while 200 executives recently took part in a “metaverse experience” at a global leadership conference.

“There’s no outward-facing use of this kind of technology at this point, and it’s really meant to gain knowledge and understanding of space in order to be ready once the technology is in the right place and, importantly, once outstanding regulatory issues are addressed,” said a person with knowledge of the lawsuits.

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