IoT for financial service providers
IoT for financial service providers
The use cases for IoT continue to emerge in different sectors. One of the segments is the financial service providers. These include banks, micro finance, micro lenders and credit card providers. The main concern of this segment is mainly security and trust. The amount of people defaulting on loans is going up and the number of robberies occuring related to banks and ATMs are on the increase. Question is, can IoT be the solution for these issues? Let us examine some of the ways that IoT can increase trust, transparency and security in provision of financial services.
Automatic Teller machines
Banks can now analyze the usage of ATM kiosks in specific areas and increase / decrease the installation of ATMs depending on usage volumes in relation to location. They can also use the same IoT data in bringing on-demand services closer to customers by providing kiosks, and increase the accessibility of services to customers.
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Agri-lending
IoT also helps customers and lenders belonging to the agriculture and farming sector. Banks and lending companies can analyze the output and other conditions of farm crops and accordingly estimate the value of the output. Based on the estimated crop yield, banks can provide flexibility in financial terms, depending upon the expected yield, frequency, and output of the crop. This can make the relationship between the farmer and banker stronger.
Credit/debit card fraud
Banks and credit card companies can leverage by using IoT is predicting fraud in debit / credit card transactions. When an ATM or Laptop customer uses a card, by verifying account holders mobile / device location and comparing to the transaction location, the bank can confidently approve or decline the transaction according to the data.
Loans and insurance
By using IoT from sensor devices installed at the borrower’s warehouse, banks can track raw materials and inventory stocks. By using this tracked data, banks can deduce the account balance and ensure that the loan is paid when inventory is sold. This helps banks reduce overhead costs of tracking and also stops borrowers indulging in fraudulent practices. Financial institutions such as auto loan and insurance companies can leverage IoT via installed sensors in vehicles for which they have disbursed loans. These sensors will notify financial institutions whenever someone tries to remove these sensor devices. This helps financial institutions minimize theft and enables fast recovery of vehicles, which is a win-win situation for both consumers and financial institutions
