What is IoT?
IoT, also referred to as the “Internet of Things”, is the independent communication between objects that help to reduce costs, optimise operations, boost the levels of work productivity as well as the quality of living. Through these connected dots and devices, the customer experience in banking has been revolutionised. Over the past few decades, the Internet has evolved to become a giant web of devices, applications and people.
How does IoT enable banking?
A huge number of devices that become connected to one another create an intelligent system of systems. In today’s day and age, more and more customers are starting to use these smart devices to access data and be able to utilise financial services online, wherever they go. This allows banks and financial services firms to gain a comprehensive profile of customer finances in real time. Through such data gathered and mined, banks will have the ability to anticipate what the customer’s needs are, thus being able to provide professional advice and solutions that will assist customers in making sound decisions when it comes to banking and financial services. As a result, IoT can be exploited by banks to become a powerful instrument in boosting customer loyalty, which will translate to more revenue and business generated for banks and financial services firms. In this world where ‘things’ are all interrelated and interconnected, banks are thus able to easily communicate with their customers, through a plethora of channels and applications.
As there are now multiple channels of communications for banks to interact with their customers, banks and financial services organisations are also able to provide advice on areas out of the financial aspect. This can be used to enhance customer loyalty and trust. Having more channels means being able to collect more information such as the spending habits of customers, personal preferences, et cetera. Banks and financial services firms can therefore adapt their marketing strategies and campaigns, by providing a variety of options and services that are tailored to meet every customer’s specific needs and wants.
One of the major advantages of utilising IoT for banking and financial services is the ability to offer convenient and rewarding services to both debit and credit card customers. Banks are empowered with the ability to analyse the activity surrounding ATM kiosks in specific locations. They can then increase or decrease the number of ATMs being installed in these locations according to the rate of usage. Through these business insights, banks can offer value-added services.
What are the Concerns of IoT?
However, IoT is also associated with security risks. Fortunately, adopting an identity and access management (IAM) solution can address these concerns. Banks process a lot of transaction data as well as the personal financial data of their customers. This causes them to be a huge target for hackers. With IAM, banks will have the latest security technologies in preventing and ensuring that all information is safe and secured.
Nowadays, everything is interconnected. With IAM, banks can utilise IoT towards their advantage.