A new report from Juniper Research has found that the IoT payments market will grow at an average of 75% per annum over the next 5 years; reaching $410 billion by 2023. This is up from an estimated $24.5 billion in 2018; the biggest growth will come from in-vehicle payments.
The new research, IoT in Finance: Payments, Insurance & Banking Opportunities, Transaction Forecasts 2018-2023, has found that the automotive sector will become the most lucrative IoT platform by 2021; accounting for $63 billion in transactions that year, 55% of the overall market, compared to just over $50 billion for connected home devices, including smart speakers and TVs. However, car-based spend will mostly be payments for fuel and tolls, but with little increase in spend overall.
The research found a significant opportunity for players in the IoT-enabled insurance market which will exceed $334 billion by 2023, primarily through telematics-based motor policies. However, this will reduce premiums; impacting insurers’ gross revenues.
Juniper believes that this decline in premiums will be offset by improved overall profitability due to reduced costs per claim; this will become more immediately evident in home insurance, with automated accident prevention through the IoT.
Source: Press Release