The realization of the “Internet of Things” is part of a natural progression of technological advancement, affecting all industries, increasing visibility, improving process flows, and, most importantly, automating actions. According to an article published in Forbes India, one of the ways in which IoT is disrupting banking is:
“Today, in the IoT-driven digital banking space, customer onboarding and KYC processes have become faster. As more and more devices acquire digital interfaces, customers can now access their bank accounts from any ‘thing’ and ‘anywhere’ through a device with a digital-enabled interface.”
While accessing a bank account from any ‘thing’ or internet connected device has its advantages, the key defining factor behind IoT is the ability to automate actions, especially when it comes to payments:
We have already started to see the use of connected devices and wearables in the banking space—for example, payments through smartwatches”
Payment through a smartwatch or contactless card loaded into a mobile device has its benefits, but it is not leveraging the full potential of an IoT device. The difference between scanning a card in your wallet and scanning the same card with your smartwatch is marginal.
However, once that IoT device loaded with a payment method is making an automated transaction based on the analysis of gathered data, the difference is significant. Today, the simplest example of an IoT Payment is a smart-printer ink transaction. A connected printer monitors the level of ink inside, and once a low-ink level is detected, the device places an order for new ink. Just like automated driving systems or automated manufacturing robots are changing their respective industries, in the same way IoT Payments will grow to change the payments industry.
Overview by David Nelyubin, Research Analysts at Mercator Advisory Group
