IoT impacts many different industries, including retail, automotive, smart devices, and even the financial sector. Financial services can benefit greatly from this technology, so let’s talk about the different ways that IoT affects banking and financial decisions.
IoT In The Financial Sector
IoT does serve a great purpose in the financial industry. In 2018, IoT spending in the banking and finance industry averaged roughly $153 million. IoT has already positively impacted the financial sector and will only continue to in the future. IoT saves financial companies a lot of time and money by gathering and transferring data. IoT also helps financial institutions improve their customer experience and better detect any fraudulent activity. It can mitigate risk and improve the entire banking security system in various ways, which we will dive deeper into below.
Gathering Data In Real-Time
With IoT, data can be gathered in real-time. This gives banks a huge advantage since they can quickly update customers with relevant information and quickly make important financial decisions. Real-time data can also benefit investment decisions since relevant data can be gathered quickly.
Because of smart IoT devices, a client at a bank can monitor lines at the branch online or schedule cash withdrawals and complete the transactions at the nearest ATM.
Improved Security & Fraud Detection
It’s no surprise that there are issues with security and fraud when it comes to an individual’s account. According to Google, Gmail engineers have blocked over 15 million COVID-19 phishing emails per day. Because of this, financial companies are cracking down on fraud detection and investing immensely in IoT to help prevent some of these scenarios from occurring.
IoT has helped mitigate many risks associated with fraud and has helped detect and block hacked accounts. IoT can gather user data and analyze the activity, where it is then sent over to the cloud, where it matches the user’s typical behavioral patterns. If any unusual data has been detected, the user will be alerted, and the account will become temporarily disabled.
The Impact on Investments & Trading
Tracking the real-time state of the market can help improve investment decision-making. IoT has the ability and potential to make accurate business predictions and track company behaviors. This puts investors at a higher advantage and is completely changing how the financial world operates. In the future, many aspects of investment banking will be automated and more user-friendly. Financial technology leaders believe IoT trading will be performed globally using bitcoin, mobile apps, and smart sensors.
Better Customer Service
Keeping customers happy should always be in your best interest. By implementing IoT applications in financial services, gathering and analyzing data can be handled much faster and more efficiently. IoT personalizes the customer’s experience and provides them with real-time data to make more informed decisions. Regarding managing money and developing reports, IoT handles all of it with ease and provides a seamless experience for customers.
Examples of IoT in the Financial Industry
Virtual assistants or chatbots have allowed financial companies to carry out 24/7 customer service experiences for their customers. Smart chatbots use language processing and machine learning to offer a personalized experience over some time.
Smart ATMs can save banks a lot of money by cutting down on employees, making banks more efficient.
This allows customers to make payments without being present. This was especially beneficial during the COVID-19 pandemic when many people weren’t able to meet in person to make payments.
IoT is prevalent in many ways and has greatly impacted the financial and banking sectors. In the future, it will continue to improve the way data is gathered and distributed, provide an overall better customer experience, and can influence trading and investment decisions that can positively affect individuals and businesses in the long term.