What are banks really struggling with today?

Like almost every other sector of the economy, banking sees data as the new oil – a valuable resource the best use of which will differentiate the winners from the losers.

Banks have been struggling with vast amounts of data and gaining any, substantial insights from them have been a Herculean task. Validating, securing and maintaining data is especially important for banks because they sit at the center of most commercial activity, giving them wide access to all sorts of customer data. That data pool will grow in the coming years as Open Banking will increase the sheer amount of data gathered about every customer.

The greatest challenge banks face today is the lack of clean, consistent and precise data. The amount of data banks derive from their customers is erroneous but deriving the right insights from them has always been a trial. Moreover, legacy data infrastructures have added to the complexity of making any sense of the huge amounts of data available. Today, there is an urgent need of real-time data that can help enhance customer engagement and improve product time-to-market. Inefficient data management has also contributed in missing out crucial insights and significant values banks can derive from these data.

Handling these challenges requires strengthening three key aspects of data management: verifying data from its origin through its full life cycle; scrutinizing how it is used to make decisions; and securing and maintaining data to the highest standards.

The good news is that customers will share their data to advance innovation. So the need of the hour is for a solution to gain precise insights from the horde of customer data to arrive at the right conclusion to enhance user experience.

The banks have direct access to a wealth of historical data regarding the customer spending patterns. They know how much money you were paid as a salary any given month, how much went to your saving account, how much went to your utility providers, etc. This provides a reach basis for further analysis. Applying filters like festive seasons and macroeconomic conditions the banking employees can understand if the customer’s salary is growing steadily and if the spending remains adequate. This is one of the cornerstone factors for risk assessment, loan screening, mortgage evaluation and cross-selling of multiple financial products like insurance.

Building true customer intelligence with the data you now have

True Customer Intelligence focuses on conceiving, enabling, retaining and enhancing “customer experience” at its foundational level.

Now is the time for the next question, “how does one enable true customer Intelligence?”

  • To address the “culture” aspect, banks need to constantly focus on training their employees on being “truly” cognizant of who their customers are. Programs must be run specifically to train bank officials to find ways and means to truly understand their customers and offer them personalized services
  • Banks must empower their personnel with an IT infrastructure that enables seamless collection of Correct, Complete and Consistent Customer Data
  • Building a Customer Centric Hub which would be the One Truth” version of all Customer data (profile, preferences, life events, transactions(recency, frequency, monetary) would be Key for any bank to acquire  true “customer intelligence”
  • With the advent of contemporary Big Data Platforms, the cost of building a Customer Hub on premise or cloud is comparatively cheaper today. Banks should start leveraging this effectively by building necessary delivery channels and consumption layers (websites, mobile, dashboards etc) to effectively use this information.
  • With Customer Hub, Bank’s personnel are able to look at the data in the same way they have been trained to look at customers. Now more as a “human being” and not as an “Account”.

Building a Customer Hub may be the first and biggest step that any bank would have to resort to. But, what is even more critical is to transform the data into “Actionable Insights” personalized to every customer. This is our Segway into the world of Analytics, Machine Learning and AI. IDC predicts that the compound annual growth rate for global sending on AI will be 50.1%, reaching $57.6 billion by 2021. This is thanks to investments in retail, banking, healthcare and manufacturing, which will make up over half of the worldwide spending on AI.

Benefits for Customers

  • Customer Segmentation
  • Customer Recommendation
  • Superior customer services
  • Enhanced Customer Retention

Benefits for banks

  • Data Driven culture enhanced by Superior Customer information
  • Well targeted product portfolio strategies
  • Controlled Data Quality/Governance
  • Precognitive abilities with respect to compliance and Fraud
  • Customer first approach

Banks are moving toward a customer centric approach to attain sustainable and long-term relationships. The high rates of customer attrition has forced banks to embrace the customer centric approach to enhance trust and in turn loyalty among customers.

imagyn.ai is one of a kind AI/ML driven framework that transforms account centric legacy systems to client centric producing intuitive interactions with customers. imagyn.ai helps banks to have all possible information about customers in one place, which in turn helps the bank to suggest customized products based on customer preferences. To achieve intuitive customer interactions, the framework channels all perspective information like account history, transaction details and customer profile into creating a one true version of each banking customer.

Discover the treasure trove of opportunities from your data!

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Anand Subramaniam

Anand Subramaniam is a thought leader, start-up mentor and a data architect. He brings forth over 2 decades of techno functional leadership in envisaging, planning and building high performance bleeding edge technology teams. He is passionate about data science domain and has championed data analytics practicesin Banking and Financial Services realm and start-ups.