Leveraging Big Data in Finance for a Win
There is a deep relationship shared between big data and finance, one that has often been qualified as being “two sides of the same coin”.
Recently---and despite it being one of the most competitive markets across the world---the finance industry is facing a new generation of disruptions, a series of novel issues that only big data can seemingly solve.
The good news, however, is that the industry is known for being an early adopter of new technology and innovation. That’s why organizations are now increasingly analyzing the potential of big data in financial services for driving security and personalization.
The latest issue of Worldwide Semiannual Big Data and Analytics Spending Guide reveals that the revenues for big data analytics will increase from $130 billion in 2016 to over $203 billion by 2020. Not surprisingly, banking is leading the charge as they spent nearly $17 billion on big data and business analytics in 2016.
As other components of the financial industry adapt to data-driven strategies, big data can enable them to find a competitive advantage and leverage new opportunities
What is Big Data?
Big data is the collective term used for data sets that are too complex to be processed by traditional applications. The term also often refers to the modern methods and technologies of collecting, organizing and analyzing this data to extract value from it.
Statistics show that around 2.5 quintillion bytes of data is created on a daily basis and 90% of all the data that we have today was created in the last two years only. These numbers confirm the impact of big data – and how it is changing the way we do business.
How It Is Helping Finance Companies Today
The financial services sector is undoubtedly the most data-intensive part of the economy and the impact of big data cannot be emphasized enough.
Take for example, how much data banks generate in a day; customer information alone includes purchases at POS, online payments, deposits, ATM withdrawals and so much more. The trouble is that banks aren’t very good at deriving value from these data sets.
That’s where financial data services come in.
Big data technologies can help collect and process this information, providing valuable insights that can be used to anticipate consumer behavior, detect and prevent fraud, and calculate the inherent risks in loans and investments.
In other words, this technology can offer immediate results to financial companies and help them gain an edge over the competition.
Four Significant Issues That Big Data Can Solve
It is estimated that the banking sector will generate 700% more data each second by 2020. As such, legacy systems are simply not capable of dealing with the sheer volume, velocity, and variety of data available.
And so, the financial industry must improve the following to get the most from big data:
- Regulatory Requirements – Improved metrics for reporting can help manage data for better analytics and insights.
- Data Security – Big data in financial services can lead to data governance measures that can mitigate risks associated with the industry, keeping data secure and protected at all costs.
- Data Quality – Financial data services ensure that companies not only store information responsibly but also use it in the best way possible.
- Data Silos – It is essential to keep information easily accessible at all times and there are various integration tools that can help with this.
Big data solutions can leverage the power of the cloud to tackle these pressing issues in the industry.
Getting Started With Big Data Financial Services
Whether you want to enhance the customer experience at your firm or you are looking for ways to optimize operations, big data and finance can work together to lead a data-driven transformation at your company.
Here’s how you can make it happen:
- Have A Defined Data Strategy – It starts with formulating a clear business goal. Then, create a comprehensive strategy that spans across the entire organization; this is also where you find ways of using data for long-term benefit.
- Select The Right Platform – Tracking data and ensuring that it is available to the right people at the right time is an important part of the strategy. It is best to choose a cloud-based data platform that is scalable, secure and allows organizations to collect and process as much information as necessary.
- Tackle One Problem At A Time – It’s easy to get overwhelmed when dealing with big data; that’s why we identify and tackle one challenge at a time.
Let CRA Be Your Technological Edge
Computer Resources of America brings big data and finance together with our cost-effective and secure cloud-based services.
Get in touch with us today to learn more about data warehousing in the cloud and how we can help you make the most of it for your finance business.