The global internet of things (IoT) in banking, financial services, and insurance (BFSI) market size is expected to reach USD 116.27 billion by 2026. The rising adoption of imminent 5G cellular technology and cloud application in IoT will fuel demand among several organizations for the implementation of IoT service based on cloud platforms for financial and security services. For instance, companies including Capgemini Financial Services and Amazon Web Services (AWS) developed IoT service based on cloud platforms for financial and security services, states Fortune Business Insights in a report, titled “Internet of Things (IoT) in Banking, Financial Services, and Insurance (BFSI) Market Size, Share & Industry Analysis, By Component (Solutions and Services), By Application (Customer Experience Management, Security, Monitoring, Data Management and Others (Payment Management, etc.)), and Regional Forecast, 2019-2026” the market size was valued at USD 17.85 billion in 2018 and is expected to rise at a CAGR of 26.5% between 2019 and 2026.
The increasing use of IoT technology in various insurance companies to extract facts and information about the product design and to access the price coverage in case of any product causality. This increasing usage will create lucrative sales opportunities for the IoT in BFSI market revenue in the forthcoming years. For instance, in U.K Just Miles, Oseven, Hubio, and Autoemo partnered with start-up companies to develop Usage-Based Insurance (UBI), solution based on ‘Telematics’ (vehicle sensors). The UBI solution is used to capture and analyze user’s data and behavior patterns. Besides, the growing utilization of IoT solutions in the banking sector to provide on-demand and easy-access-services to end-users will further accelerate the IoT in BFSI market growth.
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Key Segments in the Internet of Things (IoT) in BFSI Market
- Component: Under the segment, the market is classified into solutions and services. The solutions segment is expected to grow remarkably in the foreseeable future. The increasing demand from the financial and banking sector for UBI (Usage-Based Insurance) solutions based on telematics will augment the growth of the segment. Furthermore, the growing focus of key players towards investments and acquisitions to enhance their product offerings will boost the IoT in BFSI market trends. For instance, in April 2019, Microsoft Corporation acquired Express Logic, Inc. to expand its product offerings and promote IoT development, including Azure IoT Edge, Azure Digital Twins, Azure Sphere, Azure Maps, and Azure IoT Central.
- Application: Under the segment, the market is divided into customer experience management, security, monitoring, data management, and others (payment, etc.). Data management segment accounts for 22.5% of market share in 2018 and is expected to grow significantly during the forecast period. The customer experience segment is expected to hold the lion’s share in the forthcoming year its ease-of-deployment and operability. It also helps customers to operate in real-time from their smart devices, including smartphones, desktops, and laptops. Also, the increasing adoption of real-time operating systems in BFSI applications is expected to fuel the demand for the customer experience management segment in the forthcoming years.
- Geography: Under the segment, the market is categorized into North America, Asia Pacific, Europe, Middle East & Africa, and Latin America. Asia Pacific was valued at USD 3.35 Billion in 2018 and is expected to proliferate during the forecast period owing to the adoption of IoT technology for smart cities and smart buildings projects in countries such as Japan, Singapore, and India. For instance, in Singapore, in 2018, the Information Technology Standards Committee (ITSC) and Infocomm Development Authority of Singapore (IDA), initiated a project as “Spring Singapore.” Furthermore, North America is expected to witness a high growth rate during the forecast period owing to the presence of some of the major banks, including JPMorgan Chase, Bank of America, Citigroup Inc.
Focus of Key Players towards Market Centric IoT Solutions to Augur Healthy Growth
IBM Corporation is expected to contribute maximum share in terms of revenue owing to the development of solutions offerings of IoT for BFSI. IBM’s IoT solution for BFSI helps to improve business models by providing analytic and cognitive capabilities. Cisco system, Microsoft Corporation, and Oracle Corporation are also emphasizing the development of market-centric IoT solutions for BFSI industry.
Some of the Major Companies in the Internet of Things (IoT) in BFSI Market are:
- Cisco Systems
- IBM Corporation
- Microsoft Corporation
- Capgemini SE
- SAP ERP
- Oracle Corporation
- Accenture Plc.,
- Infosys Limited
- Software AG
- Tibbo Systems
- Intel Corporation
- July 2019 – Diebold Nixdorf, US-based security and financial services corporation, launched smart ATM, based on IoT capabilities. This smart ATM is linked with users account and assist users in making transactions by scheduling a session.
The Global Internet of Things (IoT) in BFSI Market is Segmented into:
Value (USD billion)
- Customer Experience Management
- Data Management
- North America (U.S. and Canada)
- Europe (U.K., Germany, France, Italy, Spain, and Rest of Europe)
- Asia Pacific (Japan, China, India, Southeast Asia, and Rest of Asia Pacific)
- Middle East & Africa (South Africa, GCC, and Rest of Middle East & Africa)
- Latin America (Brazil, Mexico, and Rest of Latin America)