Your financial digital twin
In my previous post, I discussed the birth of personal banking assistants – the concept of an intelligent banking assistant that helped you to manage all aspects of your money.
This assistant leveraged your data and personalised its service to suit your specific preferences and needs.
For some bankers, this paints a dystopian picture where technology replaces people. Some would also argue that money is “emotional”, and that technology is a long way away from understanding our emotions.
So, what if banks don’t create digital personal banking assistants? Would we as customers not want a better way of managing our money? Would we not delegate this to someone or something else that could manage our money the way we do today?
What if you had a digital twin that could not only manage your money the way you do, but became better and faster than you?
The concept of a digital twin is not new and is generally defined as “the virtual representation of an object or process”. The idea is attributed to Michael Grieves, from the University of Michigan, who first wrote about it in 2002.
Since then, huge investment from around the world has seen the development of digital twins for cities, buildings, cars and more. It’s easy to see that by starting with an individual object like a house or car, the concept can aggregate twins to encompass entire cities or even countries.
By creating digital twins, we can model and test how the twin would perform in different scenarios or conditions without risking its real-world equivalent. You could argue that gaming has already created these virtual worlds that we can play in.
So how does this relate to financial services and personal banking assistants? Well, some banks have already started to create “virtual assistants” that replace or augment human bank staff. Bank of America has “Erica” and DBS has “Digi Bank”. While they have made great progress, there is still a long way to go.
However, recently I spoke to John Blicq, author of “Digital Twins – The next human evolution that will disrupt the financial industry”, and he raised the idea of customers creating digital versions of themselves. These digital twins would learn from us and start to automate basic financial tasks.
These twins would need to gain our trust to eventually take over the task of managing our money. Initially, this could be as simple as providing reminders of upcoming financial events, such as bills that are due.
Next, they can provide additional insights and make suggestions. For example, if they know you’re about to go overdrawn, they could suggest you move some money from your savings to avoid fees.
Once they have gained your trust, you may decide that up to a certain amount of money your twin could make that decision without asking you.
Apply this to all aspects of managing your money and soon you have a digital twin for managing your finances. One that is independent of any bias compared to a bank-provisioned digital personal banking assistant, so that it could help with sourcing the best products and the best price for your needs.
Your digital twin could interact with other digital twins that specialise in life events that have big financial implications. These life event twins could for example talk to your financial twin to understand the cost, activities and timescales for buying a house or getting married. Now your financial digital twin is helping with life events and on the same basis could help with life stages.
This all may seem farfetched and even dystopian, but whether we like it or not we are digitising everything from physical objects and business processes to even ourselves.
As computer power, memory and bandwidth increase, our ability to digitise more and create realistic virtual worlds grows. This has many implications for mankind and society, but for banks, the key take-away is that if they do not provide digital personal banking assistants, they risk customers creating their own digital twins to manage their money. Alternatively, it could be banks that provision customers the ability to create their own digital twins.
Looking at the development of digital twins globally, it could seem like we are building out the Wachowskis’ “Matrix”.
I’m just saying banks have a choice right now to invest and build intelligent automated banking capabilities that benefit customers or risk losing this valuable service to new competitors.
About the author
Dharmesh Mistry has been in banking for 30 years and has been at the forefront of banking technology and innovation. From the very first internet and mobile banking apps to artificial intelligence (AI) and virtual reality (VR).
He has been on both sides of the fence and he’s not afraid to share his opinions.
He is CEO of AskHomey, which focuses on the experience for households, and an investor and mentor in proptech and fintech.
Read all his “I’m just saying” musings here.