IoT in Capital Markets: Catering to New Business Growth Goals

IoT in Capital Markets: Catering to New Business Growth Goals

By Capital Markets CIO Outlook | Tuesday, August 06, 2019

The capabilities that IoT has to offer can make it a potential game-changer in the capital market industry.

FREMONT, CA: The Internet of Things (IoT) is one of the most advanced technologies with a big list of potential applications that apply across industries. Trends in the capital markets industry also suggest that the integration of IoT capabilities with the current business models have tremendous possibilities. IoT enables physical devices to stay connected with the internet, creating a network which facilitates an easy and smooth transfer of data in real-time. Development of smart sensors that can detect essential metrics has played the most significant role in making IoT feasible.

Once critical data is collected through smart sensors in connected devices, they can relay the information through internet-based communication. With the availability of crucial data in real-time, decision making is not just smarter and faster but also highly relevant and dynamic. According to estimates by McKinsey, the economic impact of IoT might touch $3.9 trillion to $11.1 trillion a year by 2025. Thus, the capital markets will see a gradual introduction to the advantages that IoT brings about.

Companies can plan and conduct business with an improved level of intelligence as and when they adopt IoT. The way IoT affects capital markets can be understood by taking the example of any company that is involved in manufacturing products or providing services. IoT enables producers to base their planning, designing, and pricing decisions to be entirely backed by data from sensors. A food processing company can hedge prices and manage market risks better by using sensors that relay weather or soil information from places where the raw material is grown, thereby optimizing business strategies.

Thus, IoT creates many opportunities for capital markets to push growth and profit with intelligent business decisions. Additionally, it can enable intelligent automation in originating trade or generating recommendations. When coupled with the processing capabilities that a bank might already have, IoT creates numerous and highly valuable opportunities for financing. Hence, IoT is a significant technology for capital markets, opening multiple benefits for trade.



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