Author: Katia Noble
Digital banking platforms and smart technology
The Internet of Things (IoT) is going to have a global impact estimated to reach up to $6.2 trillion annually, according to McKinsey.
Demand for IoT products, such as smart watches, fitness bands, smart thermostats and other connected devices is increasing fast and analysts predict that by 2020 there will be between 20 billion and 30 billion units sold (some think these numbers could be double!).
Gartner forecasts that by the end of 2015 total sales of smart watches alone will hit 40 million with Apple claiming 50% of the total volume.
Meanwhile, they published analysis earlier this year, “The Internet of Things is a revolution waiting to happen”, which highlighted that the Banking industry don’t believe that the IoT will have a huge impact on their business.
The need for innovative banking platforms
This is despite the fact that 63% of all respondents, across all industries, believe that in the next five years the IoT will have a significant transformational impact on their businesses. Of those, 50% said that the primary impact will be in customer-facing products and services.
The banks, being traditionally conservative, seem to be missing a trick again!
The banking industry is changing fast with many new players entering the market. Their main weapon is innovative services underpinned by digital. Consumers’ expectations are shifting as a result of a digital explosion in every aspect of life – shopping, entertainment, traveling, fitness….Pick almost any industry and you will find the Uber’s, Amazon’s and Spotify’s that have become an ubiquitous extension to people’s lives.
Delivering a superior customer service
There is one common similarity between these successful businesses; they are ecosystems of interconnected services and products that help provide a superior customer experience.
The IoT offer further opportunities to form new ecosystems or enhance existing ones.
Two examples of how Apple is starting to unleash the possibilities for IoT are:
- Apple Watch is creating new ways of monitoring health and fitness, making payments and controlling one’s finances.
- Apple Pay is available on multiple devices – iPhone, iPad, Apple Watch &, no doubt in time, Apple TV; allowing the customer to conveniently link one or more devices to their account.
Mbanking, mobile apps and their part in the IoT
A study by TCS argues that mobile apps are the most common way companies leverage IoT; as seen by early successes such as British Gas’s active heating service, Hive.
With the mobile now accounting for the largest banking channel, according to KPMG, it is time banks opened their eyes to the opportunities of IoT to enhance their product offering, marketing and customer service.
Part II of this blog will outline how banks can leverage the IoT as well as key considerations.