Deloitte have produced a new fascinating report about the size of the market for the Internet of Things (IoT). Here’s the management summary and you can download the whole report here .
Can financial services, which deals mostly with the intangible, benefit from Internet of Things technology? Absolutely—and not only from more and better data about clients’ physical assets. IoT Technology applications aim to transform finance along with every other sector.
IoT may be as broadly transformational to the financial services industry as the Internet itself, and leaders should make an effort to recognize the opportunities and challenges it presents for the financial sector as well as for industries with which FSIs work closely.
Notwithstanding the inevitable hype, many industries see great promise in IoT applications: Analysts and technology providers forecast added economic value of anywhere from $300 billion to $15 trillion by this decade’s end.1 Few analysts seem to expect anything but a transformative effect on just about every dimension of economic activity by 2020. The IoT—based on the concept of physical objects being able to utilize the Internet backbone to communicate data about their condition, position, or other attributes—is likely going to matter a great deal. (For an overview, see Deloitte University Press’s “Internet of Things” collection of articles.2) And FSIs can be active participants in this transformation.
Indeed, FSI leaders can easily imagine the potential benefits accruing from having more comprehensive, real-time data about their own or their clients’ physical assets. Some use cases have already proven themselves: Applications such as auto insurance telematics and “smart” commercial real estate building-management systems offer clear IoT examples of new products or changed processes. Our aim in this report is to go a step further by exploring the IoT’s potential impacts on the financial services industry when those effects are hazier. We also aim to help FSI professionals such as claims administrators, portfolio managers, loan officers, and leasing agents understand how IoT applications may change their jobs in the coming years.
Adapted from Deloitte report