Geolocation is the remarkable capability to pinpoint a device’s location through a combination of GPS, cell phone towers, WiFi access points, or a fusion of these technologies. Since these devices are typically in the possession of individuals, geolocation tracks a user’s physical location down to specific latitude and longitude coordinates, or more practically, a physical address. Significantly, both mobile and desktop devices are capable of leveraging geolocation.
Key Takeaways
- Geolocation refers to the use of location technologies such as GPS and IP addresses to identify and track the whereabouts of connected electronic devices.
- Often carried on an individual’s person, geolocation is frequently employed to trace the movements and location of people and for surveillance purposes.
- Extensively utilized in the financial services industry to help prevent fraud and provide customers with localized information, geolocation can also present potential privacy concerns.
Understanding Geolocation
Geolocation encompasses a wide array of methods and applications. IP addresses may be utilized to determine a user’s country, region, state, city, or postal code. This technology can also determine time zones and precise positioning coordinates, useful for tracking wildlife or cargo shipments. Whether shopping online and locating nearby stores, ordering food online while searching for local restaurants, or finding the nearest ATM, you’ve interacted with geolocation services.
Examples: Geolocation in Financial Services
Geolocation becomes exceptionally valuable when applied to financial services. For example:
Payments: Financial institutions with mobile apps that have location tracking enabled can match the phone’s location with the location of the payment card in use, detecting potential payment card theft. If the two locations do not align, fraudulent activity can be identified instantly, and the card can be deactivated. Conversely, if the locations match, customers can avoid disruptions due to typical fraud prevention measures detecting out-of-place card activity.
Insurance Claims Processing: Geolocation technology within an insurance claims adjustment app can verify a policyholder’s location, reducing fraudulent or exaggerated claims. A visual claims platform allows policyholders to interact with their insurance agents via a web-based real-time communication system to evaluate damage, determining a fair claim amount. Using phone cameras for live video calls, agents can capture photos, zoom in, or use flashlights to document damages accurately, resulting in higher customer satisfaction and fewer regulatory complaints, which benefits both insurers and their customers.
Banking: Bluetooth beacons, used similarly in retail for targeted discounts and consumer behavior analysis, and found even in bank branches, offer new conveniences to banking customers. Geolocation allows access to ATM services via mobile phones after hours, enhancing convenience. The beacon technology alerts employees when customers wait too long in teller lines, redirecting them to other available staff for assistance, thereby improving service efficiency.
Geolocation and Privacy Issues
While geolocation offers numerous advantages, it also brings forth safety and privacy challenges. When enabling location-based services, consumers must be cognizant of data usage and sharing pathways to safeguard their privacy and safety. Companies must assure the security of shared geolocation data, preventing misuse or unauthorized access. Customers typically do not wish for their geolocation data shared for banking convenience to also verge into avenues like advertising without their explicit consent.
Financial services companies can build trust by clearly disclosing geolocation data usage upon first use of an app, allowing customers to opt-out or discontinue use if dissatisfied with the policies. Users should also have options to delete their geolocation history at a later stage if desired. Establishing trustworthy usage practices is pivotal for continued successful deployment of geolocation technologies.
Related Terms: IP Address, Payment Card Theft, Insurance Claims Processing, Bluetooth Beacons, Tailored Advertising.
