3 Ways Big Data Revolutionized Finance or Fintech Firms

The finance sector has gone to the next level with innovation in technology, such as big data. Today, the manner in which financial service firms, banks, online lenders, and Fintech companies function has been due to technological improvements, big data, business intelligence, and artificial intelligence to name a few.

There are many benefits of big data to these finance companies. When individuals talk about modern, innovative technology and the finance industry, they mean digital transactions, banking applications, and of course, Internet transactions. The manner in which technology changed the financial sector is beyond that. That is because online transactions are fast, hassle-free, and convenient for both banks and customers. Today, we all withdraw cash from ATMs and cash-points. Whether it is a purchase or business transactions, all prefer the online medium. It means that these banks or finance companies have loads of data to manage.

The phenomenal change comes from the data produced by electronic or online transactions. Be it PCs,laptops, smartphones ortablets, all such devices store data. They also produce data based on your buying habits and preferences. And this information could be leveraged by the finance companies or Fintechs to offer customized, improved financial products or services to delight their clients and take customer service to another level.

According to an article published on Huffpost, risk management, for example, is one area where the finance companies or Fintechs can benefit from data analysis.

The finance industry is to provide better, dependable services and financial products for all their clients with big data. It would also help to reduce the risks at which finance or Fintech firms are susceptible to data theft and breaches. Read on to learn about the three ways in which big data revolutionized finance or Fintech firms.

1. Tailored services

When it comes to banks and financial enterprises, with the advent of big data, they offer customized services to their customers. It is one of the biggest achievements of these banks and Fintechs, thanks to big data. Many such finance firms assert that they look for more number of customers who are looking for personalized financial services and products.

The demands to create customized financial services in the sector is driven by the increased number of finance or Fintech companies embracing big data, thus making the industry rife with competition.

Did you know that many banking institutions started opting for the services of Fintech firms to take their services to the next level and provide more tailored products and services?It also leads to improved, all-encompassing, and great infrastructure that helps to create a more customized and simplistic experience for all types of customers.

With big data, Fintechscan figure out the buying habits and spending behavior of customers to recommend financial products or services. Besides, these finance companies can help people to save their hard-earned dollars with better financial products and services. Unlike conventional banks, online lenders and financial companies focus on customized services that meet the exact needs of modern consumers, especially the millennial. Therefore, big data is a blessing for customers and finance companies alike.

2. Segmentation of banking customers

Today, finance companies, online lenders, and Fintechs are popular for their focus on customer-first policy, and customer segmentation is one such area that is the buzzword in the industry. The financial sector now focuses on dividing the clients based on their age, sex, purchase history, behavior, economic conditions, and geographical factors.

With these parameters under evaluation through big data, finance or Fintech companies can assess and examine the spending habits of modern consumers. Again, the finance companies depend on aspects such as age, sex, income, and social status of the customers. They can also effortlessly customize their services and financial products as well as diverse products to meet the needs of every customer segment.

The most esteemed patrons of banks or finance companies, specifically those who spend the most could be easily identified in this regard. It will help in generating enhanced customer satisfaction levels because individuals usually look for highly customized financial deals and offer,including financial products. For instance, if a customer buys movie tickets using a bank’s debit card all the time, the finance company or bank will pamper that customer with loyalty points on the card. The customer can redeem those points and buy a movie ticket at a discounted price.

3. Improved compliance abilities

The finance companies or Fintechs should abide by certain rules and regulations. It is mandatory. It calls for regular financial audits and compliance checks to meet the particular requirements of the finance sector with respect to privacy, security, finance, and safety of online customer transactions. Big data helps banks and Fintechs in achieving these compliance goals with useful data with regard to customer requirements.It also means customer expectations.

With the usage of cloud data, the Fintechs can reap the maximum benefits out of data analytics and implement them in their systems. It lets the finance companies derive actionable insights for better customer service. Furthermore, the Fintechs and other online lenders that provide customized loan options can now evaluate and identify where a monetary problem is more expected to happen and change their business strategies to adhere to certain stringent precautionary steps. It is imperative to avoid or reduce data pilferage, theft, and breaches resulting in the financial loss of customers.

The finance sector is changing and developing at a rapid pace than you can imagine. It includes internet banking services, online purchases, and payments. The banks, finance, and Fintech firms have improved their capabilities as well as the scope of financial services or products offered to their clients.

Big data, artificial intelligence, and smart technologies are opening new opportunities and paths in the financial sector and offering outstanding benefits to all customers. Eventually, the advancements of big data in banking and finance result in more customized services for business-to-business as well as business-to-consumers audiences. There is no doubt how big data has changed the financial sector for the better in the last couple of years.

Conclusion

Big data has revolutionized banking and finance without a shred of doubt. It is beneficial for both finance companies and customers.

Isabella Rossellini is a marketing and communication expert. She also serves as content developer with many years of experience. She has previously covered an extensive range of topics in her posts, including business and start-ups. For more visit http://libertylending.com