Today, analytics is becoming a significant game-changer in the financial sectors. Following the tradition, the banking, financial services, and insurance (BFSI) sectors are putting their full potential to widen their business opportunities and enhance the services that they provide their customers.
According to an article recently published by Forbes, “over 2.5 quintillion bytes of data created each day.” This is a massive number, and therefore the significant increase in the customer volume is placing a humongous pressure on the levels of the services offered by these organizations.
Stakeholders are now looking for new ways not just to organize their data but also to use this data to track their customer’s behaviors. In this way, these organizations will be able to use their data to provide their customers with the exact type of resources needed at a given time.
Big Data resources have become a key player for the BFSI sector, helping them in several areas that provides these organizations with improved customer experience and boosted performance and profitability.
Why Banking & Finance Sector need Big Data?
Big Data can help the BFSI sector in not just organizing their data but it also helps to improve customer experience. The answer to the question (Why the BFSI sector needs Big Data?) could be summed up in three points. They are:
- Customer Experience
- Operation Optimization
- Employee Engagement
Customer Experience
Customers place high expectations in the way they want their banks to interact with them. With the increase in customer volume, it has become difficult for banks and other organizations to fulfill the demands of every customer.
Big Data helps organizations to acquire a 360-degree view of their customer. It provides them with necessary personal information, transaction history, browsing history, and other relevant information helping the organizations in creating customer segmentation.
Big Data also helps in making marketing decisions that can bring a remarkable increase in marketing productivity.
Operation Optimization
Big Data can help the BFSI sector to improve the predictive power of their risk models, which is the main reason it is gaining popularity in the Banking Sector. Big Data provides more extensive risk coverage and significant cost savings. Following are some of the areas of risk management where Big Data can be used to attain risk intelligence:
- Fraud Management
- Credit Management
- Market and Commercial Loans
- Operational Risks
- Integrated Risk Management
Big Data in Banking and Finance sectors helps to detect fraud signals which are analyzed utilizing machine learning and ultimately identifying legitimate users or transactions.
Employee Engagement
Employee Engagement is a hidden potential of Big Data that is yet to be unlocked. Big Data is not only concerned with customers, but it also helps in detecting employee performance. With the help of Big Data, organizations could identify their top performers, and if utilized in the right way, it can help organizations to boost up their performance ratio.
Using the right tool, such as analytics, a company can track, analyze, and share:
- Individual Performance
- Team Spirit
- Interaction among Departments
- Overall Company Culture
Big Data helps companies to analyze their performances daily rather than just annual based reviews.
In a Nutshell
Big Data, combined with other global trends, can help the BFSI organizations to get a better hold of their needs both internally as well as with their customers and clients. It helps in providing improved services in real-time with less operational costs.
Image Credit: Malcolm Garret; Pexels
