News, Education and Events Decoding Digital Payments & Fraud

News, Education and Events Decoding Digital Payments & Fraud

Smart Home Payments for One and All

Smart Home Payments for One and All

By Oren Levy, CEO, Zooz

Smart Home Payments for One and All The Internet of Things (IoT) has become quite a buzzword. Only a few years ago, many of the predicted offerings—from self-driving cars to adrenaline dresses—sounded more like the products of fevered imaginations than realistic options. Companies at the recent CES 2016 show, however, revealed these items and many other pretty amazing offerings already on the production line. Future applications will no doubt impact many ecosystems, from industry to agriculture. According to a Gartner study, the world will see  25 billion Internet connected “things” by 2020 . It further estimates that IoT will produce close to $2 trillion of economic benefit globally, by transforming many enterprises into digital businesses and improving efficiency, as well as producing new sources of revenue.

One of the most exciting applications of IoT is in the private home. Already, home owners can control lighting, temperature, multimedia, security, and window and door operations from afar. But the automatic replenishment of home supplies is taking household IoT to the next level. And to make it work, manufacturers must incorporate secure payment options within an automatic refill process, enabling systems to independently handle the entire acquisition cycle from start to finish.

Let Your Smart Appliances Pay

Among the devices unveiled at the recent CES show were several appliances capable of replenishing supplies and paying for them automatically. For example, Amazon Dash embedding enables Whirlpool’s 2016 lineup of dishwashers, dryers and washers to independently order supplies when you are running low. The Amazon Dash buttons connect the appliances with specific brands. This means that if you placed an Ariel-branded Dash button on your washing machine, you can reorder the preferred laundry detergent from a chosen supplier. The Whirlpool app can be linked to an Amazon account, thereby providing automatic payment capabilities.

Samsung’s Family Hub refrigerator features an LCD screen that serves as a communication center which connects to Bluetooth wireless speakers. Each time the refrigerator door is closed, interior cameras capture images of the contents. After taking stock, it transmits the list to the user’s smartphone. The homeowner can then select missing items from integrated online grocers. The final transaction is secured with a 4-digit pin, and payments are made in a single checkout experience that accepts popular U.S.-issued credit and debit cards.

While you may not be able to accomplish all this by merely twitching your nose like Samantha in “Bewitched,” it’s still pretty cool. And who knows what else will be possible soon? Perhaps flying cars and multi-purpose robots are in the cards. But before sprinting off to buy these smart appliances, be sure you consider the pros and cons.

The Drawbacks

The ability to place and pay for orders is often based on an Internet connection, Wi-Fi or Bluetooth. So, what happens if your Wi-Fi isn’t functioning, the Internet isn’t available, or your Bluetooth is spotty? Consider several scenarios: If the appliance is disconnected from any one of these sources, what happens to the order? Will the washer keep it in its memory and make the order later? Will the system notify you that it was unable to complete payment? What happens if the payment system fails in the middle of a transaction? The concept of smart appliances is exciting, but only if they make your life easier by functioning smoothly.

Another issue is the ability to connect only to specific suppliers. The user can only buy through preset suppliers, payment methods and products. So while the concept of automatic replenishment is tempting, you may be missing out on special discounts from other suppliers that can offer lower costs.

Security is a problem that worries many consumers. Shoppers are still hesitant about mobile and other payment methods because of the threat of cyber breaches. Their concern is that fraudsters will be able to hack into their appliances’ systems and gain access to personal payment data such as credit card numbers and PINs. Another fear is that cyber attackers will be able to penetrate smart security systems and unlock victims’ doors and windows.

The Smart Home—Who will Go Whole Hog?

Having the ability to smartly stock your fridge or turn your coffeemaker on before you rise are neat and fun tricks. It is also great to be able to control the heating, lights and oven from afar. However, establishing interconnectivity between various appliances and systems is not a simple task, and even veteran home improvement experts may find the initial installation and ongoing maintenance challenging. Costly smart appliances and interacting controls must provide homeowners with concrete added value and equanimity when it comes to user-friendly operations, secure payments, and system reliability. Otherwise, the smart home will remain a “nice to have” toy for wealthy geeks.

Oren Levy CEO ZOOZ Oren Levy is the CEO of Zooz. The payments company, based in Israel, enables merchants to connect with multiple financial institutions, seamlessly integrate acquirers, e-wallets, alternative payment methods, fraud management and other third-party services, and intelligently route transactions through the entire payment process.

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Daniel Leibovitch