The transformation of financial companies is taking place due to technologies such as artificial intelligence and machine learning. Moreover, the core of these innovations is served by big data which creates value for the investment through finding a meaningful pattern.
A large data based on transactions is taken from the customers every day and to draw meaningful insight from the unstructured data is a time consuming and tedious work. AI can simplify this process and provide structured data and make decisions within less time. The findings will be presented in a clean and simple format by identifying potential patterns in the data.
Different types of financial services by the bank include credit cards, car loans, mortgage loans, and personal loans that are provided based on the behavioral patterns in the data stored by banks. The risk profile can also be managed by big data to improve the returns and meet the needs of the customer.
Advantages of Big Data in Finance
To manage customer expectations, financial firms use big data and thus delivers customized solutions. Based on the data collected from the customers, they are provided with personalized investment solutions. Big data makes the transaction processes faster using the financial information stored and saves the time of the customer. Advanced cybersecurity is ensured through measures such as fraud detection and unauthorized logins. The security systems in the bank can alarm customers whenever a cyber-attack occurs.
Price movements can be predicted from the data of past behavior with the help of tools offered by financial companies which enables fundamental and technical analysis. The application of algorithms is the emerging trend in the financial services industry which aims to get better returns on investment. The portfolio is managed on autopilot with the help of data-driven AI programs. The performance of the top companies can be tracked by financial institutions using AI technology.
Challenges faced by financial institutions due to big data
Storage of big data is expensive and at times it also requires maintenance costs. To keep up with the competition the financial companies have to constantly upgrade the payment plans to continue big data services. At times, algorithms cannot be used to draw insightful information from large unstructured data. Due to the privacy breach on personal data collected from customers, companies have to follow stringent data regulation laws to use big data.
However, many financial companies have benefitted by using big data which includes Yewno|Edge. It was able to enhance the investments through deep data connections and finally delivering pragmatic strategies to the customers.