How the Internet of Things Will Transform the World of Payments


What is IoT? A digital network of Internet-connected “things” that continuously share data and generate actions. It will have and is already beginning to have, a disruptive impact on the world around us through smart home technology.

These “things” are everyday household items such as kitchen appliances such as refrigerators and ovens, car dashboards, smart speakers, washing machines and dryers. These devices connect the physical world to the digital world by collecting data from the real world around us to create actions on our behalf, such as making digital payments. Unlike QR code payments, this does not require human intervention. This is the beauty of the Internet of Things (IoT). Your device will do the talking.

How is the wonderful world of IoT possible?

By 2021, half of the world’s population will own a smartphone. By 2030, 5 billion people are expected to use smartphones. It is precisely this ubiquity of connected devices and internet connectivity that makes the IoT possible. To see how this is impacting the world of payments, just look at data from ACI Worldwide and Global Data that 52.7% of the world’s population uses mobile wallets. Coupled with the move to the cloud and machine learning, organizations can scale with natural language processing and gain insights more easily. Besides being smart and affordable, IoT can also appeal to people.

IoT devices can leverage new machine learning technologies to meet consumer-specific needs. A world where you can pay bills from the dashboard of your car, a world where your fridge can track finished groceries and add them to your weekly order, or automatically make eCommerce purchases with your Google Home or Amazon Alexa smart speaker. Imagine a world where you can Machine learning enables devices to learn human needs and act accordingly.

Secure the future of smart homes

IoT has enormous economic potential, expected to generate $13 trillion in revenue over the next few years, but that opportunity will only be unlocked by consumer confidence. Consumers are skeptical about sharing data, putting microphones in their homes, and expanding their digital footprints. Not only do consumers need to trust the makers of their devices, but financial institutions and merchants also need to have the right tools in place to verify their customers’ identities and prevent payment fraud. This means we have the right technologies to monitor risky transactions, such as tokenization and machine learning.

Optimal use of hyper-connectivity

The increased demand for IoT devices will not only benefit consumers but will also drive increased demand for goods and services from merchants, enabling more payments to be processed through networks of banks and financial institutions. increase. Ordering pizza from your smart speaker at home is just the beginning. Hyper-personalization and automation are key to creating positive customer experiences and driving frictionless spending. Queues, cash-in, and entering card data are a thing of the past.

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