Big data and analytics, a popular topic of discussion at Sibos
After much anticipation, Sibos 2015 finally kicked-off. One hot topic across the conference floor on day 1 was big data and analytics.
Financial institutions are sitting on piles of data—after all, they truly are information companies. But for financial institutions, the data that they hold has its challenges - the sheer quantity, the disparate formats in which it’s stored (ISO 20022 is the term du jour), the silos are not consolidated across the enterprise, encryption, etc.
Then there are regulatory implications. Privacy applies to the use of the data. Compliance applies to the numerous layers of data processing. Rules exist around retention requirements.
More and more, the banks are perceived as commodity providers with no differentiation in their offerings. In contrast, Fintech companies are finding ways to innovate using the portions of data they can access to meet a unique customer need in a new way.
I believe the banks have the same power to gain intelligence and insight from their data. They can use it to develop a more holistic understanding of their customers and to create products and services that they really want. While the regulation around that data might be complex, the magnitude of the data within a financial institution should not be underestimated. The opportunity is there.
It’s true that the fundamentals still exist. More normalization of the data is needed, but the analytics in which loans and credit cards are offered and fraud is prevented provides a strong foundation for turning the piles of data buried under banks into insightful, actionable information.
An ACI industry perspective elaborates on how the adoption of the ISO 20022 standard can help financial institutions understand their customers and provide differentiated value-added services. Click here to read more.
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