Leverage the real value of data
Have you ever wondered how much data you create every day? With each online payment, tweet, like, comment on social media or click and tap in your browser we generate data. According to a study by IBM, we create 2.5 quintillion bytes of data every day. And this number is just growing exponentially every second. In the seventh edition of “Data Never Sleeps”, it is estimated that there will be 40x more bytes of data than the number of stars we can observe in the universe.
Furthermore, a recent study by International Data Corporation (IDC) showed that global revenues for big-data and business-analytics solutions are estimated to reach $274 billion by 2022, with a compound annual growth rate (CAGR) of 13.2 percent over the 2018-2022 forecast period. Looking at these figures, it becomes clear that data is BIG, but the potential value of data is even bigger.
From Data to Insight “Let the data decide”
Tech companies like Amazon, Apple, Facebook, Google and Microsoft, are the pioneers of Big Data. Ever since they gained enormous advantages from big data methodologies and techniques, they became among the most valuable listed firms in the world.
In addition to tech companies, Fintech & Regtech companies and neobanks are shaping the future of financial services with their digital products and services. It is estimated that the value of the worldwide fintech market will reach to $309.98 billion at an annual growth rate of 24.8% through 2022. They combine big data with artificial intelligence, machines learning, blockchain and other technologies to carve out the competitive advantage in the new banking landscape. For example, there are new algorithms called Convolutional Neural Networks which are based on the way people think and act. They can learn a customer`s behavioural patterns and adjudge if a transaction is legit or fraudulent. This gives them a huge advantage in fighting fraud and cybercrime while reducing the operational costs. Data has also received more attention in many other industries ranging from health care and governments to insurance and financial services. Given the potential value of data today, it comes as no surprise that many call data the “new oil” of the 21st-century economy.
The financial industry is already one of the world`s greatest data-intensive sector in the global economy. The study of IBM shows that the financial industry could deliver the fastest revenue growth from Big Data and Analytics. For this reason, the impact of data on the sector is impossible to overestimate.
Drivers for Data-driven banking empower each other and show the need for harnessing the immense value of data:
Deployment of analytics and data-driven capabilities helps banks to:
Growth revenue
The ability to collect and analyse on real-time data for insights helps banks to have a 360-degree view of customer behaviour trends, internal process efficiency and market trends. This helps banks to identify and anticipate (new) business opportunities as well as retain and acquire new customers. And this, with a competitive advantage in the market.
Improve efficiency
Data enables banks to optimise and streamline the internal processes with the help of machine learning, artificial intelligence and robotics. As a result, banks can increase the performance and reduce the operating costs. Banks also leverage the online and offline channels efficiently to improve the customer increase.
Improve risk management
Banks will be able to minimise compliance risks by assuring the trusted data that is required by regulators. They will develop and assess customer risk profiles to enhance fraud detection and improve the credit management.
Financial services institutions can only benefit when they gain insights from big data through high-performance analytics. These will help and quicken your decision-making process, enhance your business processes and understand your customers better. This way, the financial industry can innovate and create value following a solid data-driven approach.
We’ve already helped numerous financial institutions set-up and deliver a successful data-driven strategy. If you’d like to know more on this subject or our previous experiences, connect. We’re always happy to have a (virtual) coffee break.