Payments and the Internet of Things

Posted by Patty Whelan on May 31, 2016 05:00:00 AM

Topic: ALL

Payments and the Internet of Things

Have you heard the term “Internet of Things”? If you haven’t yet, you’re not alone according to a 2014 survey done by an e-commerce and digital marketing consultancy firm. Eighty-seven percent of consumers polled for the study were not familiar with Internet of Things (IoT). It’s a phrase that refers to the phenomenon of previously unconnected everyday objects (such as cars, consumer electronics and in-home appliances) embedded with sensors and computing power that enables digital access and control from anywhere — on a variety of devices including mobile, desktop and tablets.

The IoT increases the connectivity of people, data and things.  Data provided by Internet-connected devices can be applied to create highly targeted ads and offers. The greater the quantity and variety of data sources— the greater the ability to customize offers for individual consumer profiles. This sometimes causes consumer concerns about privacy. Secure elements layered into the technology may enable consumers to find greater acceptance when the benefits are perceived to outweigh the risks.

This technology is still in its early stages but greater application and adoption is expected; as the integration becomes less expensive mainstream consumer adoption is inevitable. Research gathered for the study cites a lack of awareness of the connected technology to be the top barrier to mass adoption. It found that 64 percent had not purchased any in-home IoT devices because they didn’t know items like smart fridges and smoke detectors are available for purchase. Additionally, 40 percent of consumers were unaware that wearable technology was available in the marketplace.

A more recent report from a June 2015 study, Consumer Perceptions of Privacy in the Internet of Things, takes a different point of view regarding consumer familiarity with IoT connected devices and suggests it is only the industry term for these items that is unknown. The study of 2,062 surveyed U.S. consumers found 28 percent owned a smart gaming system, 23 percent had a smart TV, 7 percent had wearable devices, 4 percent owned a connected car, 4 percent had connected appliance and 3 percent had a home automation hub.

In the payment space, the Internet of Things is evident in digital wallets that securely store a user’s payment information and passwords, enabling consumers to use an electronic device to make transactions. Bank Mutual and TransFirst® offer EMV®- and NFC-capable countertop terminals and contactless PIN pad payment solutions to help our merchants to future-proof their business. These solutions help to ensure the ability to adapt to EMV requirements and take advantage of new NFC payment and mobile wallet opportunities.  Integrated NFC capabilities support alternative payments and value-added applications such as loyalty or gift card acceptance. Convenient payment devices allow merchants to process a range of transactions through multiple connectivity options.

As consumer interests in mobile wallets and alternative payments increase along with merchant demands for cutting-edge solutions that offer:

  • Greater security and mobility;

  • Sources of rich data;

  • And ways to improve the customer experience;

Bank Mutual and TransFirst will remain committed to providing innovative products and services that meet or exceed our clients’ payment processing needs of today and tomorrow.

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