Internet of Things – Mobile Financial Services

Internet of Things – This article investigates the many Internet of Things (IoT) scenarios for which the industry has a solution, as well as how to market or position the solution. The convergence of payments, physics, blockchain, and artificial intelligence, which is changing digital money usage, is critical to the future of payment intelligence. Mobile Payments marries the Internet of Things (IoT) and explores the expansion of the Internet of Things (IoT) and how it may effect financial services.

Internet of Things – MFS

This article explores the different scenarios  for Internet of Thing – IoT ; which the industry has a solution at hand, how to present/position the solution – Mobile Payments gets married to IoT and to discusses the growth of the Internet of Things (IoT) and the ways it could impact financial services.

As more consumer devices connect to networks and people, new opportunities and challenges arise. can we call this as Revolution.

• New opportunities and challenges arise as consumer products increasingly connect to networks and people.
• Utilizing science and technology enhances security and efficiency, advancing digital payments significantly.
• This strategy improves understanding, safety, and operational efficiency, yielding impressive outcomes.
• Blockchain and AI simplify and secure payment processes, ensuring transparency and tamper-proof transactions.
• Smart contracts streamline transactions and unlock creative opportunities across various industries.

The arrival of new era, IoT in the coming period will spread so much that it will enter into every area of our lives, we will become units in the internet world. We will no longer sit on our computer or browse on mobile phone. Internet will become essential component of our life like Air, Water and Food and would get into our life so much that we can’t be separated from this. Difficult to say will it be good or bad thing.

What is the Internet of Things?

The IoT (Internet of Things) is a network of physical objects embedded with software, sensors, and connectivity. The “things” within this network can sense, process, and share data with each other.

Current examples of this technology include shoes with GPS trackers, Apple technology with watches, and Google technology with wearable glasses.

From different research and market inputs and studies, the estimated size of the IoT (Internet of Things) market varies with a huge gap.

IoT Growth Projections

• Gartner’s Outlook: Gartner forecasts nearly 26 billion IoT devices with a global economic value-add of $1.9 trillion by 2020.
• IDC’s Estimate: IDC predicts IoT-connected devices will generate nearly $9 trillion in annual sales by 2020.

Evolution of IoT

• Historical Perspective: IoT is not new, evidenced by established machines like POS systems in retail.
• Future Transformation: The focus shifts towards evolving human-machine interactions in technology.

Scope of IoT

• Interconnected Entities: IoT encompasses diverse smart devices capable of or adaptable to Internet connectivity.
• Range of Devices: Includes household appliances, health monitors, gadgets, security systems, and everyday items like mobile phones, cars, and even banking services.

Furthermore, the IoT extends its reach to encompass a myriad of devices, encompassing everything from smart cooking utensils and toothbrushes to GPS-enabled footwear and wearable technologies like watches and clothing, thereby offering an all-encompassing connectivity experience.

Economy of Things – EoT

In the EoT, everyday objects seamlessly connect with digital platforms, transforming how goods and services are created, consumed, and managed. With real-time data insights and automation from IoT, businesses optimize operations, reduce costs, and improve efficiency. EoT inspires innovative business models where products function as nodes in a digital ecosystem, offering personalized experiences and predictive analytics.

• Automated Payments: Your fitness tracker managing gym membership payments based on workout frequency.
• Smart Fridge: Automatically ordering groceries and handling secure payments when supplies are low.
• Future Possibilities: Imagine your car paying for parking autonomously.
• Economy of Things (EoT): Integrating physical items with digital services seamlessly.
• Technological Drivers: IoT, AI, and blockchain fueling the connected world since the mid-2010s.

FinTech – EoT Enabler

It’s all about creating new ways to do things, making life easier, and opening doors for businesses. Here, Fintech swoops in like a financial superhero! It’s the magic that makes money flow smoothly in this connected ecosystem. This exemplifies the synergy between the Economy of Things (EoT) and FinTech, the financial cornerstone of our interconnected world! Think of it as the brain of the whole operation, handling all the financial stuff:

• Frictionless Payments– Forget cash or swiping cards. Fintech lets devices, machines, and you pay each other instantly and securely, all through the internet. No more fumbling for wallets at the self-checkout lane!
• Financial Inclusion for All– No bank account? No problem! Fintech is opening the door to financial services for everyone in the EoT, from individuals to businesses. Imagine a world where anyone can participate, regardless of their background.
• Smart Contracts – Peace of Mind, think self-executing agreements. Fintech uses blockchain tech to create secure, automated financial contracts – no lawyers or paperwork needed! Your car can automatically pay for parking as soon as it pulls into a spot, no sweat.
• Data Like a Superhero’s Secret Weapon– Fintech uses info from connected devices to understand how we use things and how businesses can run smoother. It’s like having a superpower to see exactly what’s going on. This helps businesses tailor services and products to our exact needs.

In short, Fintech is the glue that makes the EoT work. It lets physical things and digital services talk to each other seamlessly, boosting economic growth and innovation along the way. Pretty cool, right?

AI, IA and blockchain technologies ensure secure transactions, power smart contracts, and maintain transparency, enhancing trust and reliability in economic transactions. This transformative integration blends physical and digital realms, creating a smarter, more interconnected economy accessible to all.

IoT’s Potential Impact – From Hype to Inevitable Evolution

People hailing from diverse backgrounds may question whether the Internet of Things (IoT) is merely a buzz worthy trend or an unavoidable progression in how individuals, devices, objects, financial systems with sensitive data and portfolios, and networks will interconnect in the foreseeable future. They ponder the potential marvels or mishaps that could reshape their daily lives and personal information.

However, we, the knowledgeable aliens encompassing IT and Financial Technologists, possess a clear trajectory and a well-defined approach towards realizing this transformation. Imagine a future where interconnected personal health planners communicate with investment and personal banking systems, proactively managing liquidity in response to health emergencies like heart attacks. This integration, though convenient, requires careful oversight to mitigate financial risks.

• Financial institutions like Bank of America, early adopters of digital practices, are poised to capitalize on IoT advancements, particularly in wearable and sensor technologies.
• The IoT revolution is reshaping industries and revenue streams, with a focus on miniaturizing and cost-effectively integrating technology into diverse applications. By 2020, Gartner predicts nearly 30 billion wirelessly connected devices worldwide.

These points highlight the transformative impact of IoT in finance and technology, emphasizing both opportunities and the need for strategic management of risks. Those in financial services who have already implemented digital practices, such as Bank of America, will be in the best position to benefit from these new IoT technologies quickly. Increasing investments in wearable and sensor technologies indicate a major shift in development.

Which it self-declares a dollar value of $3 trillion with an assumption of an average cost of $100 per device, and this is only device marker services; support is on top of this. According to PwC’s 6th Annual Digital IQ Survey,  financial services is one of the top ten industries investing in sensors for devices like beacons in stores for coupons, etc.

Telematics and IoT Enhancing – Financial Services

As of today, the most common use for sensors is telematics, which allows devices installed in cars (car tracking devices) to transmit location data to owners and insurers. This also includes the ability to track a stolen vehicle and help in recovery, automatic crash notification, and vehicle data recording to force full actions by the controller over telematics infra. Telematics also extends to tracking ships, cars, and trucks for fleet management and route optimization.

IoT merged with mobile financial services can ensure you can get fuel by giving your telematics number at a fuel station, and the tracking company can monitor fuel consumption as well as any fuel leakage or theft. You can also pay your parking tickets, renew your car registration, and buy discounted oil changes, and you will authorize all of this from your smart phone or any normal phone by SMS or USSD.

Apple introduced Apple Pay in 2014, which is again not new or innovative in mobile payments industry technology but gave a renewal chance to the IoT (Internet of Things) within the mobile financial services industry. Apple Pay users send secure mobile payments without compromising subscriber personal data (at least as expected and claimed). More seamless transactions make a big difference in creating a better customer experience.

Apple iBeacon technology allows retail customers to access location-specific coupons, product information, or recommendations while browsing in stores. Imagine you walk into a store to buy some clothes with your friends, but the store manager himself comes to greet you and take you to the section of your choice and taste as well as pocket size.

Now remember that small beacon thing that will notify the store manager about your entry. Give your CV to him to treat you like a special guest, and the bill is again paid upon your confirmation via phone. This digital ecosystem of physical objects will change the way financial institutions, systems, banks, or even your mobile wallets interact with you at the most basic levels. Bringing “things” (IoT) online will eventually make payment transactions implicit rather than explicit, as explained in the previous example.

Conclusion: Innovations also come with new risks. The deluge of new data is likely to complicate data management for financial services firm. And of course, cyber security may become an even greater challenge. The question that remains is how far will the Internet of Things go? How can other sectors such as banking and investment management leverage the IoT technology? But it may one day appeal to the self-tracking health junkie or tech-obsessed millennial covered in wearable tech.

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