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Robb Gaynor Oct 23, 2017

Wear the action is: The wearable ecosystem meets the future of banking

In this one instance, you don’t have to check your smartwatch to know what time it is: The moment for wearables to advance has arrived.

Financial mobility will see corresponding improvements; in other words, those really limited first-gen watch apps for banking will improve dramatically. The latest Apple Watch marks a major step forward and offers a good glimpse of what’s to come, which is this: not just a “latest gadget” paradigm of high-tech, but one where many devices create a “wearable ecosystem” that will prove more and more useful in our daily lives.

But first this premise: Wearables matter. That is, they can and will prove indispensable and increase the portability of our favorite apps and web sites. After all, why else would we want to put devices on our body other than to increase utility and mobility? This of course implies a broad category.  A shirt with a microphone built in is an example; socks that can take your blood pressure another. Yes, when we think wearables, we tend to think about watches and Fitbits. But headphones—already ensconced in the world of wireless Bluetooth—are a wearable technology as well. We can build technology into everything we put on our bodies: It all counts as wearables.

On that score, the new Apple Watch is significant for two reasons. First, it works untethered from the iPhone and has a cell device built right in; this means the watch doesn’t have to communicate through the phone. Second, it creates a “conversational ecosystem,” tightly integrated with the wireless AirPod headphones and voice-activated assistant, Siri. These advances dramatically increase the opportunity to build really, really cool wearable apps.  Compare that to several years back, when the first generation watch apps were very limited because they relied on technology tethered to the mobile phone and did not integrate voice very well. This will all change: The inevitable push forward is already under way. 

In fact, the latest Apple Watch is more correctly a “wearable ecosystem” watch: headphones and Siri all available to create clever apps. Of course Apple is not alone. The same eco-system does and will exist for Android devices as well. The technology might differ slightly but will fundamentally work in the same way. That means the app developer’s job should get easier as these advances spread across major devices such as the iPhone and Android and generally take place at about the same time.

One other point to clarify:  Voice activation via Siri has to work and work well. The Natural Language Understanding (NLU) must function at a very high level; for the wearables ecosystem to exist, NLU must be a reality. In practical terms, that means when you talk to Siri or Alexa or Google Home, they’d better understand you.  If not, the wearable ecosystem will fail to coalesce. And behind great NLU is—yes, here it comes—artificial intelligence, or AI. 

While complicated in its supporting technology, voice-activated AI is pretty simple to understand. To make sense of a voice as it naturally speaks or is typed into a text box—and without having to “train” the technology excessively—you need great NLU. That requires analyzing huge amounts of unstructured data. Enter AI, as that represents its fundamental purpose. In essence, AI looks at lots of data and makes actionable sense of it. In the case of understanding natural language, spoken or written, the data is the incoming voice recording or text, digitized of course.

To make it to that next step—response to the human voice—you need really robust AI-driven NLU to make it work. Exciting as they are, Siri, Alexa, Google Home are just pretty good; they’re not perfect and require lots of training and thus a time commitment to implement. But solutions exist. A few technology providers can specifically solve this NLU problem and sit behind the various voice-device providers. No doubt, NLU will emerge in higher relief and clarity as it matures. Alexa does a pretty good job considering that it costs around $100 and improves every day.

So what can we do with this slick new ecosystem and the ability to literally wear our apps?  First, we can take account balances on the road. Every time we launch a new channel or device in the digital banking arena, checking an account balance becomes far and away the single most used feature, as it will be with wearables. We can already receive balances on the watch but you have to look at them and stay in close proximity to your phone—so close you might as well use the darn phone itself.

That’s where the wearable ecosystem will mark a significant advance: It can fetch your balance quicker than checking the phone. It can deliver the balance to the watch using its built-in cell device to communicate with the outside world—while the headphones use the speakers and built-in mic if needed for talkback. It boils down to a simple voice command and a simple voice response, all delivered through what you wear: a watch and headphones. 

Or how about an alert about debit card usage?  Today’s watch gives you a “ding” notification while an alert pops up on the watch screen. But once again, all of that happens only if you are near your phone. With a wearable ecosystem the alert hits the watch as before but can take place any time, even when the watch is not near the phone. We can also send a voice cue if the headphones are enabled and active, or extend the experience and turn the alert into an “actionable alert” by allowing a voice response to react when the alert is received, and perform an action such as transfer money or talk to a service rep.

But there is more. The wearable ecosystem beckons with exciting extended possibilities. It will greatly enhance our ability to keep consumers engaged and informed.  And as we explore the technology, new uses are bound to emerge that haven’t been developed just yet. For example: Why not use the wearable ecosystem to transfer money to your friends when you are close by them? (Whether the wearable will be able to detect that your friend owes you money and triggers a transfer without an audible prompt is another story.)

Many, many potential applications exist in business digital banking as well: approving automated clearing house payments and wires, receiving incoming payment alerts, or perhaps just browsing your information and balance reporting in snippets. All are possible with the advancement of the wearable ecosystem.

So stay on top of the latest: Even if the socks don’t match or the watchband doubles as a rubber band, this is one trend that will soon become very much in fashion.

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Robb Gaynor is the chief product officer with Malauzai Software, Inc., based in Austin, Texas.

Check out Robb Gaynor on our podcast episode: Artificial intelligence and voice banking.

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