Location intelligence in banking can be used for a variety of useful security and marketing purposes, and we’ll explore four of those uses below:
1) Increased geo-relevance
In previous times, banks and other financial institutions would target potential customers based on demographic segmentation and clusters of affluence. Nowadays, retail banks can use location intelligence to help pinpoint opportunities based on the shopping habits of its prospects.
In the age of the smartphone, consumers regularly check in to businesses using the GPS location function of their devices. This provides a clear indication of their current needs and wants. Banks can utilise access to this timely and relevant consumer information via social media channels, allowing them to better target potential customers.
For example, let’s imagine a customer called John Smith. After John spends a day visiting various car dealerships (the bank knows this because he has checked in at each of them), it’s an ideal time to then contact John with offers for car loans via social media advertising, emails and text messaging.
2) Card and eWallet authentication
In 2020, the number of cases of credit card theft continues to increase. Card theft can be incredibly costly to the banking industry, with thousands of reversed transactions on a daily basis.
However, with location intelligence, banks are now able to confirm whether cardholders are in possession of their card by comparing the whereabouts of an IP address a transaction or money transfer was made from with GIS intelligence from their smartphone. This means that fewer fraudulent transactions will be allowed to slip through the net and that legitimate cardholders will never be inconvenienced by having their card declined unnecessarily.
3) Fraud reduction
Did you know that credit card fraud is the most prevalent form of identity theft in the world? Thankfully, card fraud can be reduced with the simple use of location intelligence in banking. Banks can use LI to assess the distances and times between transactions and detect any unusual patterns in real time. This helps to rapidly shut down fraudulent credit card activity and limits any damage to both the bank and the cardholder.
4) Location intelligence for local convenience
For most consumers, convenience ranks as the most important factor when it comes to daily banking services. However, many banks still look at location in the form of a customer’s mailing address. With location intelligence, banks can understand where their customers are during the day, and this presents a clear advantage when it comes to planning the expansion of the banking network, including any future acquisitions or ongoing investment. It also allows banks to proactively get in touch with their customers to provide them with convenient information such as their nearest branch or ATM, to keep them engaged and maintain a positive relationship.
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