The Internet of Things is increasingly standing for a phenomenon of social change more than technological hype. A change affecting the relational dimension of individuals and that will certainly be a driver for the digital disruption and transformation also in the banking sector.
According to the Internet of Things “Observatory” at the Milan Politecnico, there are currently between 10 and 20 billion IoT devices and forecasts foresee an increase up to 50 billion in 2020 worldwide, to have a financial impact split between 3.9 trillion dollars and 11.1 trillion by 2025.
In Italy, according to the same estimates, at the end of 2015 the IoT market totaled EUR 2 billion, an increase of 30% compared to 2014, due to the increasing number of users who are using mobile devices. (data from the “Internet of Things” Observatory of Politecnico di Milano, July / August 2016).
Iot means smart objects as part of fitness, wellness, Information: which however the impact on the banking industry?
According to Brett King, CEO of Moven and evangelist of the digital transformation within banks, by the end of the decade the relational paradigm between banks and customers will deeply change.
Now little used, IoT devices and systems will have an increasingly important role.
The key to success and adoption will reside, once again, in the user experience.
It seems that the world of payments will be one of the first invested by “IoT” wave and we mostly talk about safe and biometrics authentication.
Our body has unique characteristics and dynamics that can be used as a unique access keys to our accounts and our credit cards.
Selfie Pay, for example, will allow us to authorize payments via the mobile device shooting a selfie. The system scans our facial features, which are unique, but also asks to blink to verify the real user’s physical presence. Visa and MasterCard have already given the green light to integration in their circuits, and initially you may use it in England by the end of this year.
Nymi, on the other hand, uses the “smart” bracelets that many of us already wear. The authentication, in this case, occurs through the heartbeat: indeed, through the decoding of the rhythm, unique here as well, of our electrocardiogram. Project started, but not yet released.
Kerv is finally a ring, also aesthetically pleasing and resistant to water and shocks, enabling the contactless biometric payment. Funded by a grassroots campaign on Kickstarter, Kerv has already obtained the approval of numerous players such as McDonalds and Starbucks. Unlike other devices, the ring is totally autonomous and does not have to be coupled with smartphone or other devices.
Banks have already invested heavily in the use of the mobile channel for communicating with their audience thanks to the HD mobile networks (+ 4G / 5G). According to the ING International Survey on Mobile Banking 2016, 39% of Italian owners of mobile device (smartphone or tablet) now uses mobile banking services, a big increase compared with 36% of last year. Among these, 75% say that the use of new channels is able to improve their finances management (ING International Survey on Mobile Banking in 2016 conducted by ING Bank on a sample of approximately 15,000 investors in 15 countries in which ING Bank is present).
Doors open, then, to IoT and biometrics.