The Internet has changed the way people do business, especially when it comes to retail. More and more people are opting to purchase items online, making a big impact on how retailers do business all the way down the line to the manufacturers they use.
But the bigger questions is, "how does the Internet change banking?"
For those banks who have not adopted Internet for Things (IoT), they are missing out on the value IoT brings to both the bank and the bank's customers. In fact, banks who have opted for IoT have reaped the rewards. For example, banks that use IoT can help determine whether to keep a branch open or closed by adding sensors that actually track the foot traffic going in and out of a particular branch, giving the bank invaluable information about any branch. This IoT sensor technology can also be used to track traffic at ATM locations. To take it a step further, IoT technology can also implement Bluetooth Low Energy sensors that distinguish a customer at the bank after hours and thus let them into the ATM lobby after banking hours.
Banks Can Help Customers by Using IoT Location Data
The use of IoT technology for banking allows the bank to customize their services. First, however, a bank needs to install a very strong wireless network along with security devices to keep the data they collect accurate and safe. From here, banks can use this data technology to decide which branches to close, where to open new branches, and determine which services a bank should offer, as well as hitting sales targets. According to a report released by Proximity Directory and Unacast, the location and proximity data collected answers to these banking questions by communicating the amount of foot traffic coming in and out of a branch, as well as revealing underserved and over-served areas.
Furthermore, with this information about foot traffic at different branches, banks can decide how many ATMs they need in specific locations. The report goes on to state that aside from foot traffic, other factors play a role in determining where to place ATMs. These factors include the foot traffic for daytime vs. nighttime at a particular branch, whether the branch encompasses high or low-income households, whether the branch is located in a commercial area, and which competitors are close to the branch location.
The goal of a branch is to deliver personalized services, something most customers have come to expect. To increase customer loyalty, banks need to use mobile technology along with advanced analytics to deliver this personalized service "at the right place and the right time," according to the report.
In 2016, Citibank used a "test" program along with the company Gimbal, who supplies beacon technology, to figure out how to give their customers an improved mobile experience that is both relevant to a customer's needs and location. Citibank also sought to offer a way for customers to access ATMs after hours, with this information being supplied to the bank. The result of the test pilot found that more than 60,000 Citi Mobile app customers joined the program. Instead of using their ATM cards to gain access to ATMs after hours, customers used their phone with the mobile app to gain access. According to the report, when the customers came to the bank, they were prompted by an alert asking if they would like to enter the branch's ATM location. The customer simply had to select "unlock" on their mobile app, and the ATM lobby door opened. The mobile app is a kind of key that allows customers to enter ATM lobbies after hours without having to swipe a card.
Things to Consider Before Using IoT Banking Technology
Not all banks have utilized IoT technology as they continue to analyze whether or not IoT is right for their bank. Aside from this, banking institutions also need to make sure the IoT technology they use is successful. This means that the IoT foundation must be solid with a powerful wireless technology that connects devices without interfering with any existing networks already in place, such as the networks used by employees and guest Wi-Fi.
Another important factor for banks to consider is privacy. The data they collect from customers must be protected. Therefore, banking organizations must employ an endpoint security solution that wards off any attempts at a data breach. To do this, IoT devices should be separated from the banks broader network. This way, if an IoT device is hacked, the hackers won't be able to access the wider banking network that contains confidential customer information.
Ready to Utilize IoT?
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