Deltec Bank, Bahamas says Big Data and AI Are Changing Banking for Good
Big data is taking over seemingly every industry discipline from STEM research to banking. The more banks begin to introduce innovative technology into their customer and professional experience, the more customers they can serve. A large customer base requires more efficient services, something that can be helped by improving the data science aspect of banking.
According to Deltec Bank & Trust, The Bahamas “There is an immense amount of data that is generated and managed in banking and finance, especially as customer use leans more and more toward the digital realm.” Big data analytics have allowed banks to keep up with customer demand by the gathering of electronic records, abundant, dynamic data storage, and acquiring real-time industry insight. The rapid technological changes in the industry have given rise to financial technology, or “Fintech,” the main applications of which are to make online transactions and ease the process of managing investments.
What is Big Data?
Big data in and of itself is essentially exactly what it sounds like. Falling under the umbrella of data science, this term simply refers to large datasets that need to be statistically analyzed to visualize trends and correlations. In the field of banking and finance, the large datasets allow employees to predict customer behavior and strategize business activity based on that.
There are two primary divisions of data:
- Structured: information that is managed by a business unit to gain industry insights from on which to base decisions
- Unstructured: this data is sourced from multiple points and is primarily meant for statistical analysis
The value of data is very much dependent on how it was collected, processed, and stored. The interpretation of that data is even more important, as it directly influences business activity, and therefore success. As the technology becomes more widespread, banking professionals become more precise and significantly faster in their work.
The Benefits of Big Data in Banking
The uses of big data in the banking and finance industries extend much further than just convenience. Also referred to as “business intelligence” (BI) tools, some applications of big data assist professionals to identify risks of money lending and analyzing market trends. These uses will aid finance experts to determine interest rates based on up-to-date data and reduce any risk of errors in customer data records. Safety and security of service have been largely improved, allowing analysts to more easily identify fraudulent transactions and better screen for ineligible customers.
Big data can also greatly improve the customer experience by allowing banks to better monitor customer behavior. Based on data on customer investment patterns, shopping habits, and financial circumstances, banks can improve customer relations and increase maximize lead generation.
There are also many advantages of big data on the customer end: the incorporation of big data into the digital banking experience is what allows customers to check their balances, deposit paychecks, transfer funds between accounts, and so much more. Largely due to the eases of such a self-service experience, banks that have applied the tech to their business have been reported to see a revenue increase of 8% and 10% savings in business costs.
Customer service and relations aren’t only improved collectively but for individuals as well. Users of mobile banking apps, for example, can have a highly personalized experience in digital banking, in fact, they expect it! It has been estimated that nearly 1/3 of banking customers expect their bank to be familiar with a certain amount of their personal information. If their relationship with their bank is not based on or somehow tailored to that information, they are likely to end that business relationship.
Artificial Intelligence in Banking
According to Deltec Bank, Bahamas “AI is an incredibly unique application of big data in any industry including banking.“ The use of machine learning based on the statistical analyses of large data sets further improves the customer experience in digital banking. Applications of AI include chatbots in mobile banking apps or websites, along with voice assistance and security in the form of biometric authorization.
Some of the most well-known uses of AI in the industry include Kasisto’s conversational AI to use as either a chatbot or virtual assistant, and Affectiva’s world-renowned robot, Pepper, a humanoid that reads human emotion.
Although the current applications of big data have already shaken the banking industry to its core, we have yet to see everything fintech can do. The innovation is showing no signs of slowing down, so all banks would do well to move toward integrating the technology into their business model.
Disclaimer: The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.
About Deltec Bank
Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients’ unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.
Media Contact
Company Name: Deltec International Group
Contact Person: Media Manager
Email: Send Email
Phone: 242 302 4100
Country: Bahamas
Website: https://www.deltecbank.com/
