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The IoT foreshadows the bank of the future



By providing objects with a payment capability, the IoT is revolutionizing the banking and related financial services sector. Still often perceived as gadgets, connected objects nonetheless represent considerable potential for Fintechs, which economic players should take full advantage of.


The IoT, the other digital revolution
The Internet of Things (IoT) is profoundly transforming the behaviour of the consumers that we are. Connected objects have entered our daily lives through home automation, our activity trackers, watches and connected cars… up to a multitude of other “wearables”. It must be said that the market conditions are met: decreasing IT costs, the rising rate of smartphone equipment, universal connectivity, and deployment of the cloud and Big data. There is no doubt that this ongoing digital revolution will have a significant economic impact, which McKinsey estimates at a total potential of $3,900 billion to $11,100 billion by 2025. The IoT invests in all sectors and although they do not produce any physical products, banks devote a significant part of their turnover to it,


Towards “everything without contact”
At this stage, players in the banking sector mainly see in this technological potential the announced disappearance of the bank card. Indeed, many are increasingly relying on mobile payment and connected objects. According to Juniper Networks, more than 50% of global point-of-sale transactions will be carried out within five years via “contactless” (mobile or connected objects), despite some reluctance from consumers, who are always hesitant when it comes to is about basing banking services on the IoT. This resistance is particularly linked to the security of connected objects, in other words, the protection of personal data, a factor which tends to further slow down the growth of digital wallets.


From smart banking to connected banking
The IoT is above all a means put at the service of a concrete use which must generate value. In the field of financial services, it represents a lever for growth and is based on a simpler, more intuitive, more personalized and faster customer experience. The IoT is able to fundamentally change the way banks interact with their customers through contact points such as branches and ATMs. In the banking sector and perhaps more than in any other, the IoT offers a level of personalization and an enriched range of services beyond banking products, and endless possibilities for customer journeys. Indeed, with connected objects, the banking service is increasingly connected and intelligent, in other words, accessible everywhere, at any time and from a very large ecosystem of devices. Vehicles, refrigerators, scales, remote monitoring alarms, and electronic toll badges are all media likely to become interfaces for accessing banking services. For the bank, they offer a continuous and instant means of knowing, and therefore anticipating, customer needs to be based on the data provided by connected objects.

The IoT is therefore one of the investment priorities of banks whose projects revolve around payment, biometrics and security… in a sector equipped, with the bank card which makes it possible to synchronize with purchases, his first connected object!

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