Business Intelligence and Analytics in Financial Services

Business Intelligence and Analytics in Financial Services

Data is a source of significant competitive advantage for any organization. Financial institutions need to support business activities and decision making in a fashion that is timely, relevant, verifiable, and personalized to meet a variety of stakeholder requirements. However, it is easy for financial services firms to become overwhelmed by the volume and complexity of unstructured data.

The reality is that, in the digital banking model of the future, data is a financial institution’s most important asset. Banks and credit unions that are able to combine their internal and external data sources to create value will find themselves well placed to thrive in what some have called ‘Banking 3.0′. There is no question that this banking reality is as true today as it was years ago. The difference is that today’s technology is making the task a bit easier.

. Customer analytics has been a good idea for some time, despite being implemented by a minority of banks. Advances in processing, memory, database design, and analytic methods can dramatically improve performance and lower costs for financial institutions. It’s time for banks to take the idea more seriously.

Data analytics is a complex subject and a complex undertaking. In the report,Customer Analytics in Retail Banking: Why Here? Why Now? Senior management examines the growing role of customer analytics (that is, predictive analytics applied to customer data) in retail banking and why it should be a priority for banks. Financial institutions with no customer analytics experience should take the idea more seriously. Institutions with customer analytics initiatives should revisit how things are being done.

There are at least three reasons developed in the report:

1. The new normal in retail banking economics.
2. The imperative for customer centricity in an increasingly self-service interaction environment.
3. Technology advancements in data analytics.

Over the next five years, these factors will advance customer analytics from a project undertaken by a minority of banks to a core competency among the majority of financial institutions.