Big data analytics and its use in the finance sector is a big deal. All banks and credit unions gain a lot of benefits when they implement big data in their analytical process of data and information of their clients. They can know their customers even a much better way. The data is quite naturally in large number and it is not possible for a human to analyze these unless he or she possesses some supernatural powers.
This is where the use of big data is so essential. According to the recent survey conducted byIDC, it is found that:
- 28% of banks admitted that investing in big data and analytics is their top and
- Most of them admitted that it helped them to provide better services and products.
It is all due to the better knowledge about their customer demographics, behavior and pattern. It helps them to reach out to their target customers in a much better way.
Comparing to the retailers, modern banks and credit unions have realized the importance of retention of customers and their loyalty. With the use of big data analytics in finance, these banks, credit unions, and other financial institutions are now able to take a more proactive approach. This eventually helps them to gain a larger number of customers and also increase their database of happy and satisfied customers.
Sharing a single customer view
With a deeper understanding of their customers, banks and financial institutions are benefitted in three specific ways when they use big data and analytics.
They come to know more of their clientele in a much better way which in turn allows them to protect their financial assets. They can now have a singlecustomer view that is shared across the enterprise. This may sound confusing but is very helpful when it comes to making financial decisions. Here is how it helps.
A customer of any particular bank may have both a business account as well as a personal account. Assume that this specific customer has a different financial need now such as:
- He or she may be looking for a mortgage
- To refinance
- Open up a business line of credit
- To explore how to pay for the college education of the child and even
- Preparing for own retirement.
As far as different financial institutions are concerned in most of the cases it is found that the data of that specific customer gathered about these diverse activities are in silos. Separate data and silo information of a customer means that different financial institutions and banks will have diverse views of that customer. None of these will be coherent and will paint an incomplete picture of the customer.
However, when the banks and financial institutions have the right big data architecture underlying, they will be able to form a single view of the customer.
- Big data will eradicate data silos to form a more complete picture as the organization will have a clear and distinct idea of every single interaction of the customer.
- This type of knowledge will reduce if not eliminate the chances of customer friction and the customer will end up having a seamless experience regardless of the fact when and where the interaction takes place.
- The employees, in particular, will be able to access all relevant information of the customer to see and analyze the entire history of the customer relationship.
All these facts and knowledge will ensure that the banks and credit unions convey logical customer care that resonates. This will eventually help them to build customer loyalty and foster customer retention.
A personalized approach
When it comes to providing a better customer experience, banks and credit unions can now follow a more personalized approach rather than follow the ‘one size fits all’ concept. It is true that the banks and other financial sector companies are taking cues from the retail sector but ultimately it benefits the customers who can now have a more refined customer experience.
How? This is because the use of big data analytics will ensure better innovations which when considered will result in tailored customer experience. All offers will be based on specific factors and aspects of the customers that will be sparked by big data and digitization. A few of these factors are:
- The geo-location data
- The product suggestions
- The tap-and-go payment
- The purchase history and pattern.
Once again taking a cue from the retailers that realized the inherent value and importance of data early on, the banks and credit unions now apply that same knowledge to personalize the offers made to customers. What is even more interesting is that they can even predict the steps the customer may take in the future during their buying journey.
As for the consumers, they expect that the financial service providers patronize them and provide better services. They simply do not want to take out a loan and end up stressed due to the monthly bills needing looking up at Nationaldebtrelief.com or other sites for a suitable and reasonable debt relief option.
According to survey data, it is seen that:
- 45% of the customers want a bank to show them all available deals and discounts
- 40% expect more personalized services provided by the banks and credit unions and
- 63% will be willing to share all required and relevant information about them so that they can get the info about products and services that are pertinent to them.
If the financial institutions do not know what their customers want, they will never be able to provide the right information, the relevant and suitable product, and personalized customer experience.
Summing it up
Banks, all credit unions, and other finance companies in this sector actually hold a treasure trove of customer info and data. Investing in big data and analytics will, therefore, be the wisest decision to make due to its capabilities to help make the most out of customer interaction. With the use of this knowledge of their customer base, they will be able to provide better service much faster.