Please Note: The post Banks can’t afford to roll their eyes at the metaverse appeared first on Venture Beat.
"...But it’s the next generation of customers that banks should be preparing for. Generation Alpha is the newest member of the family unit, the children of millennials and the siblings of Gen Z. Gen Alpha’s oldest members were born in 2010 — the same year as the iPad — and they’re the first generation born entirely within the 21st century. For the under-12 set, it’s possible that all banking will take place in virtual worlds..."
Banks can’t afford to roll their eyes at the metaverse
"With virtual assets already being traded and sold in the metaverse, there is an inevitable demand that financial services, specifically banking, ensure secure payments, investments and transactions for all customers. We take physical and online banking security measures for granted, but how do these regulations and safeguards translate to a virtual world?
Luckily, banks have a long history of dealing with fraud in the real and online markets. Forward-thinking banks are already thinking about the metaverse as well, as they seek to capitalize on the untapped potential that an immersive, memorable and personalized customer experience offers. Pilot programs are already underway for connected experiences in areas such as 3D banking and personalized virtual banking. Innovative payment platforms and decentralized autonomous organizations (DAOs) will also make their way to the metaverse, creating a safe and engaging banking experience for the next generation of customers.
At first glance, banking and the metaverse may seem unlikely allies. After all, banking is a conservative, heavily regulated industry. Yet in some ways, banking is an obvious metaverse participant, as the backbone for safe and secure virtual transactions, enabling other industries to thrive. Delivering financial services through Web3 — the decentralized internet owned by communities of users and coordinated through mechanisms such as tokens and non-fungible tokens (NFTs) — is a natural way to meet the demands of young consumers primed for interactive experiences.
Consider that millennials, who led the way in disrupting personal finance through mobile banking, now have a greater awareness of the metaverse than their younger counterparts. They take their money seriously — 75% report they work with a professional financial advisor — and Gen Z isn’t far behind. Among those aged 18 to 24, 70% check their finances daily. They’re likely to follow “fin-fluencers” on platforms such as Discord, Reddit and Instagram. Also, 41% percent have sought financial advice on TikTok. (Yes, “FinTok” is real.)
But it’s the next generation of customers that banks should be preparing for. Generation Alpha is the newest member of the family unit, the children of millennials and the siblings of Gen Z. Gen Alpha’s oldest members were born in 2010 — the same year as the iPad — and they’re the first generation born entirely within the 21st century. For the under-12 set, it’s possible that all banking will take place in virtual worlds.
Tapping new markets and customers
The metaverse is an inevitability, and it’s essential for banks to prepare the foundation and capabilities to be ready when it ultimately explodes into reality. The good news for payment providers and retail and commercial banks is that there are very few obstacles preventing them from getting metaverse-ready. By building the infrastructure to support a holistic view of customers’ accounts (both flat and digital), banks can prepare their organizations for the connected, immersive experiences customers will be looking for. Integration between digital assets and mainstream finance is at the heart of banks’ ability to tap new markets and customers — and it’s gaining a foothold among young consumers and institutions alike.
One in five Americans has invested in, traded or used digital assets. More consumers aged 13 to 39 have invested in cryptocurrencies and NFTs than in stocks. And Wells Fargo pointed out in a recent note that while crypto’s role in the financial ecosystem is still up for debate, wide-scale adoption of crypto and blockchain products is underway at some of the largest global institutions. Within banks’ IT and process infrastructures, integration is a safe way to begin tapping new markets and opening the door to the connected experience consumers are looking for. With integration, banks and their customers take another step away from physical branches and 2D online banking and closer to personalized virtual banking that connects one-on-one.
Much remains unknown about how virtual worlds will evolve. Yet even amid global inflation and monetary tightening in the US, integration between digital currency and mainstream finance continues to grow. Consumer banks must act now to leverage the metaverse to give young and future customers the personalized and immersive experience they want.
Chander Damodaran is CTO at Brillio.
"Which country is Germany’s most important trading partner?
✓ China, for the past six years. Which country sends the most foreign students to German universities? China again, with 43,629 arrivals in the last winter semester alone. With which country has Germany elevated its relations to the level of “comprehensive strategic partnership?” China. On its website, the German Foreign Ministry describes relations with China as “multi-faceted and intense”. China is at once a partner, a competitor, and a “systemic rival.”
All of this could barely have been imagined when on October 11, 1972, then-German Foreign Minister Walter Scheel and his Chinese counterpart Ji Pengfei exchanged documents for mutual diplomatic relations in Beijing. The People’s Republic of China was not the economic superpower we know today. Half a century ago it was a poor developing country, paralyzed by years of the Cultural Revolution and governed by an ageing Mao Zedong, who had long lost touch with the population, from a wing of the former imperial palace in Beijing.
There was no talk of a “values-based foreign policy.” It was the time of the Cold War. Germany and Europe were divided. The US and the Soviet Union were irreconcilably opposed. Perhaps following the proverb “the enemy of my enemy is my friend,” then-US President Richard Nixon made a surprise visit to Beijing in February 1972. China had had a falling out with its fellow communist state the Soviet Union, and Nixon’s historic visit triggered a diplomatic race to Beijing, and Germany was right in it.
Duisburg on the Silk Road
Half a century later, the “multi-faceted and intense” relationship has been demonstrated by over 100 partnerships between German and Chinese cities. For example, there is one between Duisburg and Wuhan, which size-wise are as different as Germany and China: With about half a million people in Duisburg and more than 8 million in Wuhan.
Duisburg has set up a special China unit to further build relations, and strong connections have already been made. Duisburg Zoo is proud of not only its red pandas, but also of its Chinese garden – complete with a water pavilion, arched bridge, and lion statues as a gift from its sister city. The University of Duisburg-Essen maintains cooperation with Chinese partners.
Most of all, Duisburg has become a junction on the new Silk Road. Every week, 60 goods trains arrive from China. When the first train from the far east pulled into Duisburg’s station in 2014, decked in garlands, Chinese President Xi Jinping stood on the platform, escorted by then-German Foreign Minister Sigmar Gabriel.
Changing political winds
But those images are from a bygone era. The political winds have changed – and become significantly harsher. A wide variety of delegations from both sides used to whizz back and forth between Germany and China. Today, meetings between German and Chinese politicians have become rare. The coronavirus pandemic, with China’s strict zero COVID strategy and restrictive entry requirements, has played a role. But it is not only that.
It is mostly because the elements of partnership and competition have receded in recent years, while systemic rivalry has increasingly come to the fore.
Whether it’s China’s threatening gestures toward Taiwan, the persecution of its Uyghur minority, the massive oppression of the democratic movement in Hong Kong or Beijing’s aggressive conduct in the South China Sea: The perceived triggers for confrontations with China are growing – and the common ground is crumbling.
The divergent interests of Chinese and international partners in joint ventures used to be described as “sleeping in the same bed but dreaming different dreams.” Now it seems like Germany and China have made their beds in different rooms.
Competing systems
For a long time, it was assumed that by being integrated into a globalized economy, China would draw nearer to the West politically as well as economically, explained Bernhard Bartsch from the Berlin-based think tank the Mercator Institute for China Studies (MERICS).
“Many people in China thought this too,” the China analyst told DW. But this has changed fundamentally in recent years under Xi Jinping. “Ultimately China is saying: ‘We have our own system. And we want to change the global order and the rules that go along with it.’ They no longer want to acknowledge and accept the – as the Chinese see it – Western-dominated system.”
President Xi Jinping has an ambitious goal for his country: by the 100th anniversary of the People’s Republic of China in 2049, China is to be a mature, modern, socialist power with the ability to set and shape rules, leading the world economically and technologically. Its desire to be at the center of the world order brings China into conflict with the hitherto hegemonic power, the US.
For Berlin, the conflict playing out between its most important economic partner and its most powerful ally is problematic. China expert Bartsch notes: “Germany and Europe are more frequently facing the question: whose side are you on?” In the Angela Merkel era, Berlin tried to avoid being pressured into making such a decision, Bartsch said. But since then, it has become increasingly difficult to avoid. “Germany’s relationships with China and the US are not equidistant,” Bartsch explained. “We are much closer to the US than to China. Nevertheless, we do not want to miss the opportunities offered by the relationship with China.”
The struggle for distance
In the meantime, it is becoming apparent that Berlin is distancing itself from Beijing. German Economy Minister and Vice Chancellor Robert Habeck, of the Green Party, has already announced a “more robust trade policy” toward China. At a meeting of G7 economy ministers in September, Habeck declared: “The naivety toward China is over.”
Habeck had already denied the VW group guarantees for investments in China back in May, which was a shock for the economy. For decades, German companies’ business in China had been facilitated by guarantees on investments as well as exports. Germany and China’s relationship revolved around these flourishing economic ties. Top German political leaders were regularly accompanied by large business delegations on their trips to China; the signings of new cooperation projects were celebrated. About 5,000 German companies are active in China today – with investments of about €90 billion ($88 billion).
Today the mood is gloomy. In a position paper presented in mid-September, the European Chamber of Commerce in China complained that business was becoming increasingly politicized. “While China once shaped globalization, the country is now considered less predictable, less reliable and less efficient,” the paper said.
The Chamber’s president, Jörg Wuttke, lamented to DW that “Europeans and Chinese can barely exchange ideas anymore. Hardly any Chinese dignitaries are flying to Europe. That was always incredibly important for a reality check,” he said. On the other hand, fewer German students are being drawn to China. “This means we are missing out on each other,” he concluded.
As a member of the German-Chinese parliamentarians’ group, Social Democrat (SPD) lawmaker Dagmar Schmidt has observed this estrangement first-hand. “When I was chairperson in 2014, we still had a very lively exchange. We received many delegations from China, offered talks, led discussions. It was always very rewarding,” Schmidt told DW. But the meetings became less frequent – and more boring. “People no longer spoke as freely, instead they just read from notes; it was all much more controlled.” The exchange deteriorated further through the pandemic – occasional video conferences are no match for face-to-face meetings.
Europe and China are already at opposite ends of a vast continent. Yet, 50 years since diplomatic relations began, they seem to be drifting even further apart.
While you’re here: Every Tuesday, DW editors round up what is happening in German politics and society. for the weekly email newsletter Berlin Briefing.
The post Germany and China showing strain in 50-year relationship appeared first on Deutsche Welle.
No comments:
Post a Comment