Data is a gold mine for any organisation working in the present day scenario. It plays a crucial role in giving insights, strategy making and taking growth driven decisions.
With the evolution of technology and various methods to collect data; data has actually grown ‘BIG’, hence has become – Big Data. It is no different from actual data but it is huge in quantity, unstructured since coming from different sources and comes at the speed of light like it is produced in huge numbers in a minute.
The finance industry just like all other industries is undergoing a revolutionary change since the advent of Big Data since it has opened multiple areas of improvements in the sector.
Thus, it is evident that the application of big data in the finance industry will open multiple avenues for improvements in the financial services. Here are some aspects where big data analytics can definitely add value to:
Effective Financial Models
The amount of data generated on a daily basis in banks and other financial institutions is enormous. To make effective use of this data, these organisations need data handling programs and applications. All the data and trends need to be taken into consideration to create efficient working models and actionable strategies as these institutions follow different business models according to the various services they offer.
Regular Data Processing and Storage
The database is bound to increase in the finance industry with its regular usage in decision making. Here, the big data makes use of codes and algorithms to process large volumes of data continuously and also to manage the data clouds or shared servers.
AI & ML Generates Better Returns
All the organisations in the finance sector interact with various customers on a daily basis. This information holds utmost importance to create valuable insights and also provide customer experience.To make this process more effective, some institutions have incorporated AI and ML codes to ease services and magnify fraud detection measures. This is where big data is making a difference.
The process of credit scoring is highly sensitive, so much so that it can affect the overall corporate image and business credibility. The institutions involved in this process make use of a combination of business intelligence software and big data analytics to calculate the credit score accurately.
Looking at the cyber security threats and GDPR and data compliance measures, the blockchain technology is on the rise. It has a huge application for big data, as in a blockchain network, data is stored in ledgers, which is further distributed and saved on the servers of the various bank participating. The larger the network, the more secure the blockchain. This way, it can help secure the transactions and offer more security to the organizations dealing with data that is more sensitive.