We are continuing a series of our posts dedicated to IoT & AI and this time we will have a look at the finances sector. This industry is incredibly demanding as it deals with big and important numbers on daily basis and thus it requires careful analysis and processing of all the incoming data. The Internet of Things and implementation of artificial intelligence offers new possibilities to the financial industry and some of the changes have already been implemented. Thus, Mckinsey estimates that the IoT has a total potential economic impact of $3.9 trillion to $11.1 trillion a year by 2025.
Improved accuracy of work
Numbers can be hard, especially if they are complex. Therefore, when one works with them, it’s crucial that this person makes no mistakes because even the slightest can seriously impact the whole business. Thanks to the IoT and machine learning, the data processing can now be done by machines and thus the possibility of errors is minor. All the information that comes from various devices is now safely stored in one place (bye, paperwork) and will further on be analyzed and proceeded by artificial intelligence. And that’s really useful for both huge corporations and small businesses: the less mistakes you make, the more stable your business becomes.
Predictive analytics and forecasts for the future
Machine learning allows businesses to conduct predictive analytics, which means business owners can receive a detailed report on what can be expected in the future, based on the current data and business performance. Of course, certain things cannot be predicted but overall predictive analytics is now widely used by a lot of companies because it helps in strategic planning and offers to gain a view of future business development.
More engaging payment processes
First of all, with IoT payments can now be done much easier and that’s a fact. Your smartphone is already a point of sales and this opens a whole lot of new possibilities for the businesses.
Secondly, retailers can place sensors on various objects that will interact with your smartphone as soon as you are near them. And numerous researchers have shown that those people who receive personalized messages are more likely to complete a purchase.
Augmented reality and much more — thanks to the IoT, business owners and retailers are using your smartphone in order to provide you with an experience rather than a simple purchase process. We can, in general, see a shift in the whole payment system, going from something complex to more fun and personalized. And of course, the possibility to pay for anything anytime and everywhere is golden mine for both customers and businesses because it reduces the amount of hesitation that people usually show when they doubt about completing a purchase.
To sum up, why the financial industry invests so much in IoT and other modern technologies? Because such technologies will allow financial institutions (like banks, for example) to timely respond on any customer requests or needs and tailor the product/service in accordance to these needs. Users are now expecting personalized service in any industry so for financial sector IoT is a way to outrun the competition and get in one row with other front-runners.
The financial services industry is being transformed by insurgent startup companies, which raised early $32B across 766 deals since 2013. Check out The Fintech 250 2017 by CBInsight.