Financial industry veterans are exploring the opportunities of integrating IoT in their FinTech stack to make the most of their operations, and to ensure efficient data collection, processing, and analysis
The Internet of Things is a robust technology that enables businesses to establish a network of connected devices such as sensors, cameras, and smart gadgets to gather data in real time, migrate the information to the cloud for processing and analytics, and respond to events immediately. Financial institutions need to embrace IoT in their banking and financial operations to ensure efficient data collection, processing, and analysis. Integrating IoT-based tools in the FinTech stack enables Banking, Financial Services, and Insurance (BFSI) businesses to enhance services, operations, and transaction security and deliver a top-notch customer experience.
Following are a few applications for integrating the internet of things into the FinTech stack:
Personalization and rewards
The banking industry mostly does not offer customized reward programs to attract, acquire and retain customers. However, modern customers need personalization to feel valued for their business. Integrating the internet of things into the FinTech stack will enable financial institutions to offer a customized reward program to enhance the customer experience. Embracing IoT into the financial services technology stock will help the workforce to identify the customer’s demographics and preferences to personalize their offers based on each user’s preferences. Providing services based on user preferences will improve user engagement and develop a trustworthy relationship with the bank. Financial institutions that aim to deliver a top-notch customer experience can consider integrating the right IoT tools that gather relevant customer information.
Also Read: How RPA can Revolutionize Financial Organizations
Data analytics for strategic decision-making
Data has become the core of every business, even in the financial sector. Integrating the internet of things in FinTech has become essential for banking industries to manage the massive volume of data that is generated through various sources. Financial business leaders need to implement the best IoT tools to gather the data effectively that can be later used for efficient data analytics and process enhancements. One of the significant applications of integrating the internet of things in the FinTech stack is that it enables streamlining the data collection process and improves decision-making.
Identifying fraud detection and strengthening security
Cybercriminals are on the prowl to compromise business systems and infiltrate the network to accomplish their malicious goals. The financial industry is especially highly targeted because attacks on this industry are lucrative and have high financial gains. Phishing, malware, and hacker attacks are a few common vectors that criminals use in financial sectors; it has become challenging for the SecOps teams of financial businesses to reduce financial fraud.
Financial institutions need to consider integrating internet of things technology in their FinTech stack that enables them to strengthen their security and ensure that their information is not tampered with or altered.
An organization that embraces effective IoT devices in their finance technology stack to ensure the safety and security of cards always.
Automation in managing Loans
One significant aspect that financial institutions can leverage the internet of things in their FinTech stack is automating the loan management process. It is one of the most effective ways that financial institutions can leverage to enhance their customer experience, minimize cost and expedite the time to market. For instance, banks can utilize geolocation data of the user’s smartphones to allocate risk scores more efficiently. Businesses that are able to make more accurate loan assessment risks will help them to have better efficiency in credit underwriting and offer a top-notch customer experience. Moreover, integrating the internet of things into the FinTech stack will enable banks to create smart contracts. These smart contracts enable banks to have automated payment services in place to keep all the parties involved in the loop, and the loan is immediately paid to the users after the completion of the tenure.
The Internet of Things is going to be the new normal, and the majority of businesses are implementing these technologies in their IT infrastructure to streamline their operations. Integrating IoT in the FinTech stack enables BFSI businesses to improve their business processes and deliver a top-notch customer experience.
