Should banking build an Internet of Things strategy?

Should banking build an Internet of Things strategy?

Intelligent home appliances, wearables and voice aids are some of the examples of the impact of the Internet of things in daily life. But, beyond these everyday uses, what effect does it have on business? Should banks include it in their strategies?

The term Internet of Things (IoT), coined at the end of the 1990s, refers, basically, to devices connected with automated systems that send, receive and analyze information to generate an action.

For Matthew Evans, head of the IoT program at TechUK, it’s about networks, devices, and data that create a more connected world. ” Internet of Things offers us the possibility of being more efficient in the way we do things, which allows us to save time and money,” he says.

According to Mark Albrecht, VP of Group Innovation, the IoT makes possible the transformation of business models. “The Internet of Things is an important part of a global digital strategy, which serves to improve efficiency and effectiveness. Its main role is to prepare the way for change within an organization, “he says.

As organizations break free from slow legacy IT systems, they can become more agile and respond to current market trends and demands more quickly. This frees up technology and personnel resources to focus on strategy and innovation.

The Internet of things in banking

The digital transformation looks different in each industry and in each company. In general terms, it is the integration of digital technology in all areas of an organization. That integration leads to fundamental changes in the way the company operates and offers value to customers.

For the financial sector, the digital transformation has meant the implementation of developments that improve the relationship between clients and institutions; from the appearance of smart ATMs to the use of geolocation data to prevent fraud. Through these technological developments, the Internet of Things becomes an important ally of financial institutions.

Digitization has also affected the banking workforce. There is a growing demand for data scientists with experience in banking, a skill set that is not easy to find in today’s market. It is time for the industry to develop a new workforce model to educate existing staff and recruit new talent.

Creating a plan for the integration and implementation of the IoT or Internet of things is fundamental for your institution to go a step further and better meet the needs of its customers in the coming years.

Benefits of the Internet of things for banking

  • Personalized attention: IoT connections facilitate a large-scale collection of data about users. With these data, banks can better understand their clients and offer a truly specialized experience.
  • Decision making: The data can also support the development of a better product strategy according to the profile of each user, taking into account factors such as age, consumption history
  • Communication between several devices: The combination of IoT sensors and software will allow users to make payments without cash, automatically, without the need to use the bank card or type a code in the phone.

It is clear that digital transformation is inevitable if companies want to remain competitive. Transformation requires a solid understanding of the forces that drive it. The IoT is one of those forces and has the ability to create unprecedented value and change the way you do business.

Financial services are not a sector outside of this transformation. Undoubtedly, any institution that wants to prepare for the banking challenges of the future must implement an IoT strategy. To the extent that banks and cooperatives improve their digital offerings, the greater the growth and innovation within these institutions.