LONDON, UK (Centus) - Whilst the “Internet of Things” is not a new phenomenon, the impact that it is going to have on the payments industry will be profound. Research firm Gartner has estimated that there will be 20.8 billion connected “things” by 2020, an increase from 6.4 billion in 2016. Cisco, the American multinational technology conglomerate, believes this number will be much higher, at somewhere around 50 billion connected devices by 2020. The benefits of this technology are enormous. Customers with connected fridges can anticipate that their food will automatically be restocked, and Alexa and Siri will be able to assist consumers with their wish lists by using a simple voice command. Even rings are transforming into “tokens”, meaning that they can replace sensitive payment account information to allow them to pay for goods with just a tap of a ring.
Businesses are leading the way in improving consumer protection on the “Internet of Things” technology. Visa is partnering with firms like Accenture, FitPay and Samsung to introduce a Token System, which allows payments to be made on wearable items and mobile wallets.
However, this payment method does possess disadvantages too. They are becoming so common that hackers recently broke into a casino by hacking into its fish tank, which had internet-connected sensors calculating its temperature and cleanliness. The thieves could retrieve 10 gigabytes of data to Finland. Joshua A.T. Fairfield argues that “the internet of things” is taking the West back to the Middle Ages. He says that under England’s feudal system, the king owned everything and everyone else’s property rights, which depended on their relationship with the monarch. Fairfield says under the “Internet of Things”, people do not own the items they use every day because businesses are using intellectual property law to control physical objects people think they own.
The “Internet of Things” is not a bad concept. It is an idea that could work well, if devices’ security is improved. The consumer should be at the heart of producing these items if they want to improve people’s experience of using this technology. The UK will no longer be protected by the European Union’s General Data Protection Regulation when it leaves the trading bloc, which means Brexit will provide an opportunity to address data security in Britain.
Consumer preferences must be at the heart of everything manufacturers do when they produce this kind of technology. Not every person wants their bank account details linked to their fridge. Germany is predicted to become the second highest spender on “Internet of Things” technology by 2020, but many Germans’ preferred payment method is bank transfer. This concept must be altered if it is to appeal to international markets.
Fairfield is wrong- the “Internet of Things” represents the future of payment technology. It is not a step towards a feudal Britain through companies’ ownership of devices. The problem with it is the lack of choice for consumers. Poor security is not an excuse to discourage the use of this payment method. 38 million transactions were carried out on mobile devices in 2016, a 247 per cent increase from 2015. This is an opportunity for technology companies to be innovative to meet customers’ expectations.