Nama Lengkap : Ir. MERCURIUS BROTO LEGOWO, M.

Kom

Profesi : Dosen Tetap – FTI Perbanas Institute Jakarta

Personal Branding : Business Information System Specialist

INTERNET OF THINGS FOR BANKING: FUTURE AND CHALLENGES

The financial services sector is slow to embrace IoT - but look hard enough that you will find
bright lights in banking leading this way.. - Doug Drinkwater

Internet of Things, also known as IoT abbreviation, is a concept that aims to expand the benefits of
continuously connected internet connectivity. IoT has emerged as a new technology to express a
modern wireless telecommunication network. IoT defined as an intelligent and interoperability node
interconnected in a dynamic global infrastructure network also it seeks to implement the
connectivity anything from anywhere at any time. The term Internet of Things initially suggested
by Kevin Ashton in 1999 through the Auto-ID Center at MIT. According to Gubbi et al., (2013)
stated that the Internet of Things ( IoT) is a synonym for the fully interconnected world.
Furthermore, Li et al., (2015) revealed that IOT just a concept prove to be a revolution in
advancing technology to change the lifestyles of humans altogether.
Currently, the Internet of Things (IoT) is becoming a hot issue that has become a hot topic for
various business groups. The Internet of Things in Indonesia is also beginning to be familiar in the
community and is widely used to help various daily activities. Since 1999, the development of
Machine to Machine or Internet of Things services and businesses in the international world as well
as Indonesia has continued to show a significant increase.

This statistic shows the number of connected devices (Internet of Things; IoT) worldwide from
2015 to 2025. For 2020, the installed base of the Internet of Things devices is forecast to grow to
almost 31 billion worldwide. The overall Internet of Things market is projected to be worth more
than one billion U.S. dollars annually from 2017 onwards.
IoT enabling banking

Billions of devices are connected each other, and in doing so, become an intelligent system of systems. When these
intelligence devices and systems share data on the cloud and began to analyze, they can transformour business, our lives
and our world- in countless ways.

Customers use smart devices for accessing data which allows banks to provide a complete view of customer finance in
realtime Banks can anticipate the needs of customers through the data collected and offer solutions and advice that can
help customers take sound and smart financial decisions. In this way, the ‘bank of things’ can become a very powerful
facilitator to increase customer loyalty and in turn, bring in more business to banks.

In the world of interelated “thing”, banks are communicating with customers, offering them advice via their cell phones.
A similar approach can be taken with regard to the spending habits of customers. There are multiple waysfor banks to
connect with their customers-by offering advice and rewards in othe areas of life, not necessarilly finacial . This, in turn,
will increase customer bank loyalty.

Pelanggan menggunakan perangkat pintar untuk mengakses data yang memungkinkan

bank untuk memberikan pandangan lengkap tentang keuangan pelanggan secara
realtime. Bank dapat mengantisipasi kebutuhan pelanggan melalui data yang
dikumpulkan dan menawarkan solusi dan saran yang dapat membantu pelanggan
mengambil keputusan keuangan yang cerdas dan cerdas. Dengan cara ini, 'bank
barang' dapat menjadi fasilitator yang sangat kuat untuk meningkatkan loyalitas
pelanggan dan pada gilirannya, membawa lebih banyak bisnis ke bank

In an ever-connected world, there is a transformation underway that is aims to connect the whole ecosystem of physical
objects that make up our everyday world by designing and integrating them with wireless connectivity to be monitored,
controlled and linked over the Internet via mobile apps. When it comes to what objects can be connected to this
internet-of-things, virtually anything from wearable fitness-bands, to light bulbs will be connected.

Di dunia yang selalu terhubung, ada transformasi yang sedang berlangsung yang
bertujuan untuk menghubungkan seluruh ekosistem benda-benda fisik yang membentuk
dunia kita sehari-hari dengan merancang dan mengintegrasikannya dengan
konektivitas nirkabel untuk dipantau, dikendalikan, dan dihubungkan melalui
Internet melalui aplikasi seluler . Ketika datang ke benda apa yang dapat
dihubungkan ke internet-of-hal ini, hampir apa saja dari band kebugaran dpt
dipakai, untuk bola lampu akan terhubung.
IoT Technologies is the ultimate resource to help entrepreneurs, investors, and consumers learn about the rapidly
emerging field of internet of things and related technologies such as big data and cloud computing.

IoT Technologies adalah sumber daya utama untuk membantu wirausahawan, investor,
dan konsumen belajar tentang bidang internet yang berkembang pesat dan teknologi
terkait seperti big data dan komputasi awan.

The world is moving forward at a fast pace, and the credit goes to ever growing technology. One such concept
is IOT (Internet of things) with which automation is no longer a virtual reality. IOT connects various non-
living objects through the internet andenables them to share information with their community network to automate
processes for humans and makes their lives easier. The paper presents the future challenges of IoT , such as the
technical (connectivity , compatibility and longevity , standards , intelligent analysis and actions , security), business
( investment, modest revenue model etc. ), societal (changing demands, new devices, expense, customer
confidence etc. ) and legal challenges (laws, regulations, procedures, policies etc. ). A section also discusses the
various myths that might hamper the progress of IOT, security of data being the most critical factor of all. An
optimistic approach to people in adopting the unfolding changes brought by IOT will also help in its growth.

Dunia bergerak maju dengan langkah cepat, dan kreditnya adalah teknologi yang
terus berkembang. Salah satu konsep tersebut adalah IOT (Internet of things)
yang otomasi tidak lagi menjadi kenyataan virtual. IOT menghubungkan berbagai
benda mati melalui internet dan memungkinkan mereka untuk berbagi informasi
dengan jaringan komunitas mereka untuk mengotomatisasi proses bagi manusia dan
membuat hidup mereka lebih mudah. Makalah ini menyajikan tantangan IoT di masa
depan, seperti teknis (konektivitas, kompatibilitas dan umur panjang, standar,
analisis dan tindakan cerdas, keamanan), bisnis (investasi, model pendapatan
sederhana, dll.), Masyarakat (perubahan permintaan, perangkat baru,
pengeluaran , kepercayaan pelanggan, dll.) dan tantangan hukum (hukum,
peraturan, prosedur, kebijakan, dll.). Bagian juga membahas berbagai mitos yang
mungkin menghambat kemajuan IOT, keamanan data menjadi faktor paling penting
dari semua. Pendekatan yang optimis kepada orang-orang dalam mengadopsi
perubahan yang terjadi yang dibawa oleh IOT juga akan membantu pertumbuhannya.

According Gubbi et al (2013) stated that the Internet of Things (IoT) is a synonym for the fully interconnected world.

It connects all the things with technology and makes a whole new separate world for them to interact with each other
with the help of internet. Furthermore, Li et al., (2015) revealed that IOT is not just a concept but can prove to
be a revolution in advancing technology to change the lifestyles of humans altogether [2]. IOT is something that
will not leave any physical or theoretical concept unaffected. As it demands communication between objects,
everybody should be able to fetch any content from any device at any point of time from anyone locatedanywhere and
who is a part of any business or service, through any path or network. Constructively, ‘availability' is a critical
factor that affects the performance of IOT [3].

Internet of Things (IoT) adalah sinonim untuk dunia yang saling terhubung [1].
Ini menghubungkan semua hal dengan teknologi dan membuat dunia yang sama sekali
baru bagi mereka untuk berinteraksi satu sama lain dengan bantuan internet. IOT
bukan hanya sebuah konsep tetapi dapat membuktikan sebagai revolusi dalam
memajukan teknologi untuk mengubah gaya hidup manusia secara keseluruhan [2].
IOT adalah sesuatu yang tidak akan membiarkan konsep fisik atau teori apa pun
tidak terpengaruh. Karena menuntut komunikasi antar objek, setiap orang harus
dapat mengambil konten apa pun dari perangkat apa pun pada titik waktu apa pun
dari siapa pun yang berada di mana pun dan yang merupakan bagian dari bisnis
atau layanan apa pun, melalui jalur atau jaringan apa pun. Secara konstruktif,
'ketersediaan' adalah faktor penting yang mempengaruhi kinerja IOT [3].

Future of Internet of Things

The uncertainty and business risk is always presentin any new technology. In case of IoT, it is observed that many of
the dangers are physically not present somewhat they are distorted or misstated. While it will take time to develop
the IoT vision fully, the building blocks to start the process are ready to be used. The major requirements such as -
hardware and software assets are either available in a less quantity or some of them are under development; it
is also a fact that: the security and confidentiality concerns of IoT devices are not properly addressed over past
decade. It is a whole and sole responsibility of stakeholders to collaborate and carry out the open standards to make IoT
reliable, secure and interoperable. Therefore, allowing secured services to be delivered seamlessly. Over the
next few years IoT is expected to make over $19 trillion [8]. However, the problem associated with this : these
‘things' have myths surrounding them, some of which are impacting how organisations develop the apps to support
them.

Future of IoT in the year 2015 and 2020

Ketidakpastian dan risiko bisnis selalu ada dalam setiap teknologi baru. Dalam
kasus IoT, teramati bahwa banyak bahaya yang secara fisik tidak ada, mereka agak
terdistorsi atau salah saji. Meskipun akan membutuhkan waktu untuk mengembangkan
visi IOT sepenuhnya, blok bangunan untuk memulai proses siap digunakan.
Persyaratan utama seperti - aset perangkat keras dan perangkat lunak tersedia
dalam jumlah kurang atau beberapa dari mereka sedang dalam pengembangan; itu
juga fakta bahwa: masalah keamanan dan kerahasiaan perangkat IoT tidak ditangani
dengan baik selama dekade terakhir. Merupakan tanggung jawab seluruh pemangku
kepentingan untuk berkolaborasi dan melaksanakan standar terbuka untuk membuat
IoT dapat diandalkan, aman, dan dapat dioperasikan. Oleh karena itu,
memungkinkan layanan yang aman disampaikan secara mulus. Selama beberapa tahun
ke depan IoT diharapkan menghasilkan lebih dari $ 19 triliun [8]. Namun, masalah
yang terkait dengan ini: 'hal-hal' ini memiliki mitos di sekitarnya, beberapa di
antaranya berdampak pada bagaimana organisasi mengembangkan aplikasi untuk
mendukungnya.

Challenges of Internet of Things

Indeed, the IoT environment possesses a large spectrum of challenges has a broad impact on their banking
performance, which can be divided into two categories, namely, i) General challenges: such as communication,
heterogeneity, virtualization and security; and ii) Unique challenges: such as wireless sensor network (WSN), Radio
Frequency Identification (RFID), and finally Quality of service (QoS) that is considered as a common factor
between both general and special challenges.

Memang, lingkungan IoT memiliki spektrum tantangan yang besar memiliki dampak
luas pada kinerja mereka, yang dapat dibagi menjadi dua kategori, yaitu, i)
Tantangan umum: seperti komunikasi, heterogenitas, virtualisasi, dan keamanan;
dan ii) Tantangan unik: seperti jaringan sensor nirkabel (WSN), Radio Frequency
Identification (RFID), dan akhirnya Kualitas layanan (QoS) yang dianggap sebagai
faktor umum antara tantangan umum dan khusus.

The IoT Market Potential

Potensi Pasar IoT

Indonesia’s average economic growth is forecasted to be an annual rate 5.5% during the period of 2018 to 2020. In
2018, the government launched an industry 4.0 roadmap – Making Indonesia 4.0. Key industries include food and
beverage, automotive, electronics, chemicals, textile and garment. As part of the economic masterplan, Indonesia is
working towards Southeast Asia’s largest digital economy through the 2020 Go Digital Vision. Indonesia’s digital
economy is expected to contribute US$130 billion to its economy in 2020. Currently, there is an ongoing Palapa Ring
Project to implement 36,000km of optic network. It will increase high speed internet connectivity throughout the
country, especially in rural areas.

Pertumbuhan ekonomi rata-rata Indonesia diperkirakan akan menjadi tingkat

tahunan 5,5% selama periode 2018 hingga 2020. Pada 2018, pemerintah meluncurkan
roadmap industri 4.0 - Making Indonesia 4.0. Industri utama termasuk makanan dan
minuman, otomotif, elektronik, bahan kimia, tekstil dan garmen. Sebagai bagian
dari masterplan ekonomi, Indonesia berupaya menuju ekonomi digital terbesar di
Asia Tenggara melalui Visi Go Digital 2020. Ekonomi digital Indonesia
diperkirakan akan menyumbang US $ 130 miliar untuk ekonominya pada tahun 2020.
Saat ini, ada Proyek Palapa Ring yang sedang berjalan untuk mengimplementasikan
36.000 km jaringan optik. Ini akan meningkatkan konektivitas internet kecepatan
tinggi di seluruh negeri, terutama di daerah pedesaan.

In the 25th edition of Asia IoT Business Platform Indonesia, the Ministry of Communication and Information
Technology (MCIT) launched the IoT Roadmap Draft, with a focus on connectivity. Other government support include
the Venture Capital Policy which provides incentives to finance tech startups. The policy seeks to emulate the
accelerator and incubator concept of Silicon Valley.

Dalam edisi ke-25 Platform Bisnis IoT Asia Indonesia, Kementerian Komunikasi dan
Teknologi Informasi (MCIT) meluncurkan draft Roadmap IoT, dengan fokus pada
konektivitas. Dukungan pemerintah lainnya termasuk Kebijakan Modal Ventura yang
memberikan insentif untuk membiayai startup teknologi. Kebijakan tersebut
berusaha untuk meniru konsep akselerator dan inkubator Lembah Silikon.

The Indonesian government is also aggressive in pushing for smart city initiatives. Under its Movement to 100 Smart
City plan, the country aims to achieve smart connectivity, smart solutions and smart user. In line with the ASEAN
Smart Cities Network introduced in 2018 Indonesia has presented 3 cities: Jakarta, Makassar and Banyuwangi, as part
of the pilot phase.

Pemerintah Indonesia juga agresif dalam mendorong inisiatif kota pintar. Di

bawah rencana Gerakan ke 100 Kota Cerdas, negara ini bertujuan untuk mencapai
konektivitas pintar, solusi cerdas, dan pengguna cerdas. Sejalan dengan ASEAN
Smart Cities Network yang diperkenalkan pada 2018, Indonesia telah menghadirkan
3 kota: Jakarta, Makassar dan Banyuwangi, sebagai bagian dari fase uji coba.

End of Notes
Clearly, IoT creates opportunities for new products or banking services. IoT also leverages those
they must fit their data analytics capabilities for the new world. IoT has made industrial strength, so
as they think about how to benefit from this development, banks should also think about how to
contribute to it.
Banks will not be the only ones eyeing the opportunity. The story of telcos threatening banks on
their home turf is an old one, but the IoT phenomenon could breathe new life into it. In light of this,
securing a role in the fabric of the IoT and making themselves central to its commercialization —
and the way in which their customers experience it — is arguably not so much an attractive option
for banks as a strategic imperative.
In short, banks need to leverage their strengths in payments, trust, security, and identity and take a
proactive approach to the IoT at this early stage. To ensure that they are not disintermediated by yet
another wave of technology — or beaten to the punch by the telcos. If they act now, the banks have
a powerful opportunity to play a leading role in taking this exciting development mainstream and
making the IoT to be a real, to the benefit in banking industry and consumers alike.

Singkatnya, bank perlu meningkatkan kekuatan asli mereka dalam pembayaran,

kepercayaan, keamanan dan identitas dan mengambil pendekatan proaktif terhadap
IoT pada tahap awal. Hal ini untuk memastikan bahwa tidak adanya disintermediasi
oleh gelombang teknologi lain - atau dikalahkan oleh pukulan oleh perusahaan
telekomunikasi. Jika mereka bertindak sekarang, bank-bank memiliki peluang kuat
untuk memainkan peran utama dalam mengambil arus utama pembangunan yang menarik
ini dan menjadikan IoT menjadi nyata, demi keuntungan di industri perbankan dan
konsumen.
1. Bagaimana fen omena saat ini: menyikapi ancaman atau peluang?
2. Prinsip apa yang dilakukan?
3. Bagaimana menyusun langkahlkunci merespon fenomena?
4. Cara (how to) / Testimoni?
5. Apa Achievernent/pencapaian yang telah diraih?

A BOOST TO CONTEXTUAL BANKING

DITINGKATKAN UNTUK PERBANKAN KONTEKSTUAL

Without doubt, the IoT represents an opportunity for financial institutions to find out more about what their customers
— retail and business — require, alongside a plethora of other useful information about behavior and environmental
factors, which all together they can use to shape products and services accordingly.

Tanpa ragu, IoT mewakili peluang bagi lembaga keuangan untuk mencari tahu lebih
banyak tentang apa yang dibutuhkan pelanggan mereka - ritel dan bisnis, di
samping sejumlah besar informasi berguna lainnya tentang perilaku dan faktor
lingkungan, yang secara bersama-sama mereka dapat gunakan untuk membentuk produk
dan layanan demikian.

These new tailored offerings can then be presented to customers in context — so that banks are not pushing products
they want to sell but rather products their customers need to buy. The resulting products and services should also be
better for the customers, as personalized pricing becomes a reality, for example

Penawaran khusus yang baru ini kemudian dapat disajikan kepada pelanggan dalam
konteks - sehingga bank tidak mendorong produk yang ingin mereka jual tetapi
produk yang perlu dibeli oleh pelanggan mereka. Produk dan layanan yang
dihasilkan juga harus lebih baik bagi pelanggan, karena harga yang
dipersonalisasi menjadi kenyataan, misalnya

Indeed, this is already happening in the real world, as some providers are starting to offer usagebased car insurance
which gives the most favorable premiums to the best behaved drivers, as determined by analysis of the information
transmitted by their in-car communication devices. Emerging smart home platforms could enable a similar tailoring of
home insurance products based on the provision of information about key aspects of household management (door
locking, turning off the oven, etc.) and fitness devices could obviously do the same for health insurance.

In the wholesale banking arena, connected field devices in manufacturing or agricultural sensors that monitor live stock
could generate data that capital markets firms and commercial lenders could use to support investing and lending
decisions — and sensors attached to goods in transit could enable the streamlining of banks’ cash management and
trade services, enabling the better alignment of flows of payments and goods between sellers and buyers.

And the potential value of the IoT to financial institutions needn’t emanate from the power of machines alone. Take the
example of chess. By 1997, IBM’s Deep Blue computer had been able repeatedly to beat the best human chess player.
But in 2005, people playing alongside computers were able to beat both men andmachines working separately. Apply
this to the wealth management space, where the much talked-about robo advice phenomenon is already evolving
towards a hybrid of robo and human advisory, and it is perfectly possible to envision financial institutions leveraging
robos powered by vast amounts of relevant information gathered from IoT devices, working together with expert human
advisors, to provide better informed and more effective decisions and strategies than either man or machine could do
alone.

In the retail banking space, there are some interesting IoT applications to deploy in the branch, such as video tellers and
kiosks with sensing technology which can monitor and take actions on the customer’s behalf — as well as the use of
mobile geolocation capabilities in combination with beacon technology to introduce a customer on entry to the branch,
enabling pre-queuing for improved service. Of course, how much leverage banks can generate from such applications
depends on how often their customers visit their branches — frankly an activity already in decline. The successful
provision of truly contextual banking depends upon the embedding of financial services into a broader customer
experience. Take the example of an IoT-powered shop, where a customer need only pick up an item and leave to
automatically pay for it — or an IoT-powered gasoline station where the driver fills up and drives on, secure in the
knowledge the payment has happened behind the scenes.These would be greatly simplified experiences for the
customer, but how does a bank go about ensuring it is the chosen payments provider, and how does it deal with the
challenge of the payments experience disappearing and becoming something the customer doesn’t even think about?