Skip to main content

How Fintech Payments will Transform Financial Services

Fintech innovation has evolved over several years. However, it's only recently that fintech has started to achieve its potential to transform the legacy global financial services sector.

The Internet of Things (IoT) -- devices that can handle a range of Machine-to-Machine (M2M) and human-machine interactions -- enable a variety of offerings that rely on new technologies.

These now form distinct technology platforms for online payments, and other financial functions across the IoT, which can be considered distinct from fintech in general.

Fintech Payment Market Development

The ability to use connected objects to pay for things has been a key component of the IoT concept for many years. These can vary from using an IoT device as a discrete method of payment -- such as an NFC-enabled wearable -- to automated payments based on the state of the object being measured through various sensors.

According to the latest market study by Juniper Research, the IoT payments market will grow at an average of 75 percent per year over the next 5 years, reaching $410 billion by 2023. This is up from an estimated $24.5 billion in 2018 -- and the most growth will come from in-vehicle payments.

Juniper analysts have found that the automotive sector will become the most lucrative IoT platform by 2021, accounting for $63 billion in transactions that year and 55 percent of the overall market.

That's compared to just over $50 billion for connected home devices, including smart speakers and TVs. However, car-based transactions will mostly include payments for fuel and tolls, but little increase in spending overall.


Meanwhile, smart speaker voice-enabled commerce transactions are forecast to reach $51 billion annually by 2023. Goods purchased through these devices will account for just under 12 percent of connected home transactions by volume over the next 5 years.

According to the Juniper assessment, the majority of these purchases will be for digital content, typically made through connected TVs.

"Full financial service products will be slow to come to voice commerce, as the automated processes need to satisfy compliance requirements," said James Moar, senior analyst at Juniper Research.

However, with voice assistants already supplying advisory and finance updates, there will be much data to draw on once the regulatory requirements are established and met by service providers.

Outlook for Fintech Payment Applications Growth

Juniper found a significant opportunity for vendors in the IoT-enabled insurance market -- which will exceed $334 billion by 2023, primarily through telematics-based motor policies.

However, this evolution will likely reduce insurance premiums -- impacting insurers’ gross revenues. Juniper believes that this decline in premiums will be offset by improved overall profitability due to reduced costs per claim.

This anticipated transformation will become more immediately evident in homeowner insurance, with automated accident prevention enabled through the appropriate IoT-based infrastructure.

Popular posts from this blog

IoT Device Management Demand Gains Momentum

More forward-thinking CIOs and CTOs are focused on the adoption of the Internet of Things (IoT). Management challenges are top of mind for those who have already deployed a large number of sensors and associated network edge devices. Device management services are evolving in response to a greater breadth of new device technologies such as edge intelligence and related connectivity solutions, as well as the customer scalability and security of IoT deployments. But forward-looking suppliers are also preparing for a world where 41.3 percent of the connected devices will be using some form of Low Power Wide Area (LPWA) technologies by 2026. IoT Device Management Market Development Since IoT customers increasingly need to manage a larger fleet of connected devices, ABI Research now forecasts that IoT device management services will exceed $36.8 billion in revenues by 2026. Standardization is beginning to play a bigger role in device management services, as more connected devices use LPWA t

Anywhere, Anytime Workplace Demand for SASE

The ongoing adoption of flexible working models within the enterprise market has significant implications for typical IT organizations that must now support knowledge workers and front-line employees that operate outside the corporate network perimeter. The global COVID-19 pandemic created IT networking and security challenges. The expansion of the distributed workforce, an increasing reliance on cloud computing infrastructure, and the requirement to securely connect online employees -- wherever they choose to work, at any given moment in time. Legacy IT solutions that have rigid network underlays and a requirement for on-premises infrastructure cannot adequately deal with these trends. This 'Anywhere, Anytime Workplace' led to demand for new Secure Access Service Edge (SASE) solutions, with networking and security delivered as-a-service. Anywhere, Anytime Workplace Market Development   Although converging networking and security capabilities offer enterprises a promising solut

Cloud Edge Computing Demand Continues to Grow

Public cloud computing solutions are moving closer to the edge of networks where CIOs and CTOs are hosting new apps. The edge journey is well underway for forward-looking organizations as they seek to connect with customers, improve operational efficiency, and adopt digital business technologies to drive innovation. The latest worldwide market study by International Data Corporation (IDC) found that three-quarters of organizations plan to increase their edge computing spending over the next two years with an average increase of 37 percent. A combination of factors is driving this increased spending at the edge. Cloud Edge Computing Market Development The performance requirements of expanding workloads and new use cases that leverage artificial intelligence (AI) and machine learning (ML) demand greater compute capacity at the edge. In addition, the amount of data being stored in edge locations are rapidly expanding, and organizations plan to keep this data longer. As a result, the numbe