Connected Cars to Simplify Banking Operations in the Near Future

By CIOReview | Thursday, July 9, 2015

FREMONT, CA: Motor Banking could be soon included as one of the banking services in the future, reports Mary Wisniewski for American Banker.

Technology has transformed the way of living, with increase in the volumes of mobile applications businesses have modified according to the trend. Connected car is the talk of the town as they are capable of accomplishing multiple tasks without any human intervention. Researchers are finding ways to integrate connected car with banking facilities such as checking bank balances with a voice message or turning a car into wallet to authorize a purchase at gas station.

Automatic, company sells a device that can be plugged into a car to share relevant data such as engine diagnostics, parked car locator and emergency crash response. The app pairs with the adapter via Bluetooth and securely stores every trip in the cloud. United Services Automobile Association (USAA) is currently focused on the implications of connected cars for its flagship auto insurance business. USAA sees the investment in the Automatic Labs as a way to test and learn what services could add value into the lives of its military members down the road. It reckons the connected car could help cut down on driving-related fatalities in addition to simplifying peoples' lives.

"The car is part of the constellation of different devices — probably with the phone at the center," said Andy Goodman, Group Director, Design Strategy, Fjord. "Think of a car as a remote device for the phone," reports Mary Wisniewski for American Banker.

Goodman imagines car to serve as an ATM card when someone arrives at an institutions teller machine. He sees cars used to pay for things at a drive point and even prompting a person with a grocery list based on driver’s usual shopping habits.

A report published by World Economic Forum discusses tracking behavioral information of connected cars so they can predict erosion of tires and offer discounts to drivers to troubleshoot the problem. If consumers are willing to share their information then insurance providers can refine individual risk profiles for more accurate underwriting.

“For decades, banks and insurers have employed similar, highly profitable business models. But they realize an Uber moment may finally be coming to their sector,” says R. Jesse McWaters, lead author, the World Economic Forum. “Financial technology companies are deploying online platforms, have small capital bases and make strategic use of data to acquire customers and revenues at a fast pace. Banks and insurers noted that, and are contemplating their response.”