By now, most of us are likely familiar with the Internet of Things (IoT), that network of “smart” devices, embedded with sensors and network connectivity that enables these objects to collect and exchange data. Our Fitbit is an IoT device, as is our Nest home thermostat. And Amazon Prime users have their “Dash” buttons. Phillips makes a smart toothbrush, and there’s even a Bluetooth-enabled thermometer on the market, for those so inclined.
Indeed, when it comes to things like health and fitness, home appliances and other supplies, IoT is well established. Even equipment makers like Caterpillar are adopting smart technologies, along with some cities (hello Hamburg!). But there’s a new player who’s seen the light—and realized that they need to adopt an IoT approach to stay competitive. Who are they? Financial institutions.
The Internet of Things for financial services is ushering in a new era, “whether it’s tracking driving habits for the purpose of offering insurance discounts, using biometric data to confirm an ATM user’s identity, using sensors to determine the condition of loan collateral, or remotely disabling a car that is slated for repossession.” This, according to a new report by eMarketer which found that there is substantial investment in IoT technology, with healthy growth expected to continue over the next several years.
Another report, from a survey of global executives by Tata Consultancy Services, found that those executives in banking and financial services predicted that average IoT spend, per company for their sector, would grow 31% over a three-year period—from $117 million in 2015 to $153 million in 2018. Respondents in the insurance industry anticipated their average per-company budgets to increase 32% between 2015 and 2018, from $78 to $103 million.
In contrast to this predicted growth is another stat. Only 43% of respondents in the finance industry were familiar with IoT, compared to 56% in the retail industry, who were the most “in the know,”according to an August 2015 poll by International Data Corporation. Nonetheless, the same study found that 58% of finance industry decision-makers viewed IoT as a strategic initiative, while only 6% said it was “unimportant.”
In terms of the subscription model, these stats are significant because access to the data that IoT devices provide is often through a paid subscription service. Recurly has a number of IoT customers who rely on our platform to manage their subscription plans, billing and growth. Want to learn more? Talk to a Recurly expert at (844) 732-8759 or sign up for a demo below.