It is undoubtedly the digital era and the Digitalized shift is now omnipresent, and all industries are vibrantly adopting progressive data as well as communication technology (ICT) while transitioning the business modules. The digitalized economy is now the need of the hour and is extending their presence felt with dexterity, flexible access, as well as the penetration power that enduringly shift the habit of clients as well as businesses.
Such shifts do have an adverse effect that of thwarting the supply-demand relationship, thereby creating the market better segmented, diverse, wherein services as well as merchandize have become really personalized. That also depicts the industries require reallocation of their resources, as well as most vitally, rebuild their overall tech infrastructure for enabling the pressing requirement of the swiftness as well as scalability.
Transition from IoT to BoT
As the digital age is advancing now, the buzz phrase “Internet Of Things” or “IoT” has now gradually paved a pathway for another phenomenon known as “BoT” or “Bank Of Things.”
It depicts the integration of diverse technologies like Artificial Intelligence (AI), Mobility, 5G as well as Big Data etc. Principally, it is a network where things are interrelated, which makes pursuing, location, identification, monitoring, as well as administration, much more correlated.
However, “IoT”, spontaneously is overviewed to be involved within the tangibles, and financial services business does not seem to have any straight association with it. Moreover, typically measured conservative, financial establishments like banks may not effortlessly engross in the wave where technologies are the initiatives, given the density of governance and amenability that the gatekeepers are not opening the doors swiftly.
Still, numerous banks are looking for diverse blends of technology to reshape their operating models as the digital economy is encompassing its presence and here, we have “Bank of Things”, or “BoT”.
Early on, BoT was apprehended as the substantial infrastructure that simplifies the billions of data transfers that take place every day. It could enable data collection and sharing for insurance establishments, prompt contactless payments, or provide an outline for retail banks to amass data on clients. However, BoT, could go way beyond that.
At HUAWEI CONNECT 2020 in September the preceding year, Huawei and Shanghai Pudong Development Bank, conjointly released the Bank of Things White Paper, redefining the financial service model, structuring on the concept of IoT and the related technologies.
Joining humans and things
BoT is well-defined as “a business form in which ‘things’ become one of the core productions resources of future banks and a component of the forthcoming-generation financial infrastructure with pan financial service capabilities,” which “things” refer to physical entities that directly engage in financial activities.
Giving thanks to AI, “things” become more intelligent, where they will be able to make verdicts autonomously, and likely to engross with humans via different social activities. Therefore, these “intelligent things” are anticipated to sense with its competence of environment awareness; they can express, think and memorize via information interaction, processing and storage.
Ultimately, they can recognize with the competence of ownership proving. It won’t be at all astonishing where “things” can autonomously own bank accounts and become direct banking service receivers, that are the clients.
Business models casing numerous scenarios
Despite the transformation that banks can serve “things” in general, clients still have their utmost status of the financial service industry. The sector looks to tailor-make products and facilities for clients under specific scenarios and it is remarkably useful in building such situation centric business models.
With BoT, commercial banks, for an illustration, can proactively provide services to clients by recognizing scenarios and analysing their necessities using the enormous data available. Clients will then collect quicker services with tailored advice before they comprehend their requirements.
This is a critical for personalized services, specifically when BoT is more than just about individuals but also “intelligent things”. Through this, banks can cooperate with clients, detect their knowledge and know their necessities by embedding services into production and real-life scenarios. Clients can then understand their demands better addressed with more precise services.
Financial services accessible from anytime, and anywhere
With the diminishing dependence on humans, the Bank of Things permits wide-ranging services round the clock and unhindered on locations. For an illustration, a bank can easily support your loan application at 2 a.m. When you are at the other end of the globe, as long as you have your smart gadgets with you to keep you associated.
Other services like reviving licenses or getting funds can be done anytime. That means “business hours” will become worthless, as the global scenario can unceasingly operate with the provision of AI, connectivity as well as other innovative technologies.
Amid these transactions, BoT can also detect real-time client behaviour in specific scenarios utilizing varied gadgets. Human beings may not be as involved in the service chain. Still, they are ultimately relishing the advancement of services anytime, anywhere, thanks to the unified pan-financial services supported by the likes of big data and associated analysis.
BoT goes beyond future
The concept of Bank of Things validates a new financial infrastructure that is radical and impracticable, yet hugely pragmatic in the era of a digital and intelligent society.
While the Internet of Things restructurings economy by fluctuating the interactions between supply and demand, BoT takes the upheaval to yet another level by giving “intelligent things” the financial competences. Clients can also be served with a comprehensive range of merchandizes and services without the restriction of time and location. For banks, this turns pan-financial service competences into one of the core parameters of affordability.
Shanghai Pudong Development Bank and Huawei have shared more perceptions in the White Paper. In additions of how this BoT concept can encompass service targets beyond individuals to “intelligent things”, as well as the commercial scenarios and the boosted risk management model based on an objective credit system, the White Paper also details on BoT commercial forms, the related architecture, and the situation design in the digital economy. There are more about probable technical hurdles, the prospects for pan-financial services and a new digital credit system.
Along with the lender, Huawei set up a lab for innovation in 2018, and the outcomes have been productive. In 2020, Huawei hired a deal with the bank to explore more option such as enlightening client experience, leveraging digital technologies, and powering the innovation of trades like retail, communications, transportation, and healthcare, and eventually producing a thriving digital economy.