5G networks are finally here, so how can the financial services industry adapt to this remarkable technology? The key to answering this question lies in Internet of Things (IoT) connectivity, where everyday devices from personal wearables to household appliances can be connected to networks that can transmit vast amounts of real-time data. Five networks enable such levels of unprecedented connectivity and will create a scenario where increasing proportions of human activities will be conducted as an exchange of electrical impulses. As the technology matures and communication channels achieve high levels of security in compliance with established standards, financial entities can enter this space to offer innovative products for their customers. Boris Cipot, senior security engineer for the Synopsys Software Integrity Group, had this to say:
“In a decade, I anticipate paper money will have disappeared. In its place, payment methods via smart devices will be the standard, preferred payment method—even over and above card transactions. We’re already seeing many regions of the globe moving in that direction rather rapidly.”
However, this shift is accompanied with a series of challenges, including potential data rights violations and customer concerns regarding their individual privacy. The problem with big data management in its current iteration is that increased data collection places larger storage, management, and security burdens on companies, therefore increasing the likelihood of mismanagement and data theft. The promise of 5G is that data management will be replaced with real-time analysis of device input, significantly reducing the need for companies to store personally identifiable customer information on their servers. Additionally, the higher bandwidth and speeds of 5G networks will enable companies to transition to a streaming-based data management system, which will be more secure and reliable than current software infrastructures.
“Financial services providers have a huge opportunity to provide the seamless, secure, and personalized services that today’s consumers crave. But doing so will require a digital transformation. They will need to simplify their business and operating models to enhance customer service and structurally reduce cost.”
Overview by Shreyas Shaktikumar, Research Analyst at Mercator Advisory Group
