IoT Set to Revolutionize the Payments Sector
August 15, 2016
The IoT, Internet of Things, has become a key talking point over the past few years as more and more devices are being developed with Internet connectivity. While the focus has been on wearables, such as fitness trackers, the list of devices continues to grow every month. Newer devices being brought to consumers include home security cameras, smart thermostats, smart lighting, physical e-commerce shopping buttons, speakers, and even coffee machines. In short, almost anything that can be connected to the Internet will be available. By the end of 2016, Gartner predicts that over 6.4 billion physical objects worldwide will be connected to the Internet and an estimated 30.8 billion by 2020.
"The Internet of Things is expected to have an enormous impact on every aspect of our lives, particularly in the payments sector which will see many IoT based innovations," Ramez Shehadi, Executive Vice President and Managing Director, Booz Allen Hamilton Middle East & North Africa (Mena). "Mena region will experience double digit growth in IoT investments in the coming years. Having said that, the adoption in Mena of digital wallets and contactless payment systems is not moving as fast as in other regions such as North America or Europe, and it will take some time as it has to meet the stringent security requirements being implemented for back end and supporting technologies and systems," said Shehadi.
With mobile banking becoming increasingly popular, and important, in underserved rural markets, the financial sector is at the heart of IoT progress. Along with mobile banking, financial IoT innovations are also tackling cyber security and predictive intelligence software, which are slated to protect consumers and the economy from financial fraud and attacks. In the middle East this is taking top priority as many institutions are working toward smart loan contracts which can mine and validate data which will help manage identity theft and fraud.
Leading Internet payment gateway PayPal is jockeying for the position of being the primary operating system behind Internet payments. "The problem we're trying to solve is, there's a fundamental shift happening in how e-commerce is being conducted," said Aunkur Arya, General Manager of Mobile at Braintree (PayPal's payment processing arm). "Because you have so much engagement in social messaging platforms, the messaging players are trying to become the OS [operating system] now. The experience is starting to shift from the search model to buying something wherever you are on mobile."
There are no doubt many changes unfolding in the coming months and years. Regardless of the technology, security is always key, especially when it comes to finance. At AuditMacs, our team is dedicated to this goal and will work with your company to review the technology being used by your team to make it more secure and protect your business.