Data Analytics and the Future of Banking Industry
The banking industry has quickly embraced the digital technology and is looking for innovations to simplify their complex transactions and solve their underlying problems. Data analytics is critically important to banks as every major decision to control costs, drive revenues, and mitigate risks can be better done by analyzing huge amount of data. Analytics are […]
The banking industry has quickly embraced the digital technology and is looking for innovations to simplify their complex transactions and solve their underlying problems. Data analytics is critically important to banks as every major decision to control costs, drive revenues, and mitigate risks can be better done by analyzing huge amount of data. Analytics are used continuously by banks to identify frauds, increase customer satisfaction, drive customer retention rates, risk-management, providing banking solutions, and ensuring data governance. However, banks and financial institutions are now looking beyond big data analytics to push the boundaries of innovation.
The Future of Banking Industry
The roots of banking still lie in those record-keeping books, called ledgers, where all the transactions, in and out are stored and tallied later for verification. Today, the manual ledger books are replaced by a computer which stores such records. But with cybersecurity being highly critical to banks, can they really trust all the confidential and sensitive information on a dubious cloud platform? The solution looked upon by banking industry is blockchain technology, that can fully encrypt data, maintain public ledgers which cannot be tampered, and thereby guarantee financial security. Additionally, blockchain can also eliminate the need for third-party verifications, thereby speeding up banking processes and saving transaction fee.
AI and machine learning have the potential to bring a revolution in the banking industry. The power of machine learning, natural language processing, and cognitive computing can stimulate the intelligence of humans onto a machine. With the help of complex algorithms banking corporations can easily identify fraudulent activities by recognizing patterns of suspicious behavior. The applications of AI in the banking sector is just limitless. It can be used to assist a range of banking functions including automated customer service response, real-time monitoring of regulatory requirements, and algorithmic or micro-trading.
Cloud computing is one of the fastest growing technologies today. Cloud computing provides the banks with near-unlimited hardware and software resource enabling them to scale up or scale down as per their requirement. Although banks may seem reluctant to embrace such technologies on security grounds, they might soon adopt the cloud technologies as the benefits largely exceed the costs and risks. Cloud technology can significantly lower banks infrastructure costs, improve flexibility, increase efficiency, and serve clients faster which can dramatically boost relationship with their customers.
To know more about how data analytics, artificial intelligence, machine learning, blockchain technology, and cloud technology can transform the banking and financial services industry: