CNV3-I2-3- Scope- Analytics in Finance
“The world’s most valuable resource is no longer oil, but data” is what, The Economist had famously said in May 2019 instantly catching global attention. In the days since, it has only grown in importance. Quest to control oil by powerful nations stoked numerous conflicts throughout last century. It is not inconceivable that the next major war may be fought to control data! In fact, if recent press reports about US cyberwar on Iran and other such news are to be believed, it may have already started.
Add recent breathtaking advances in artificial intelligence to that mix, and no wonder we see mind boggling innovations in business models. Even our personal lives have changed dramatically with the advent of data rich social media that have transformed social infrastructure and norms.
Although no field of human enterprise and society has been left unchanged, finance is one area where remarkable advances have been witnessed. A relatively new term FinTech has emerged in finance lexicon, and billions of Dollars have poured into new age firms promising or offering hitherto unheard-of services and convenience to people and organizations.
One of the biggest beneficiaries of these advances have been small enterprises looking to raise capital. Although strong regulations and frameworks are yet to emerge, it is exciting to see how platforms like Kickstarter, Crowdstreet, Crowdsupply and so many more allow start-ups or even early stage ideas to progress to next steps through very small amounts put together by groups of people, hence the term ‘crowdfunding”. The key to the success of these platforms is the richness of data made available to both investors and fund seeker for better decision making.
Indian innovators must be mentioned at this stage. Aadhar and Aadhar based eKYC that run on biometrics-based analytics systems at scale have huge potential to usher in unprecedented customer security and convenience, notwithstanding privacy concerns that have somewhat stalled these use cases.
That clever use of data enhances customer experience is perhaps the biggest driver for the increased use of analytics in finance. Robotic Process Automation (RPA) increases customer delight further by reducing human based error prone touch points, at greater speed of execution.
Dr. Jyotirmoy Dasgupta had a distinguished International professional career spanning over four decades. He has significant experience in domains such as BFSI, Manufacturing – process and discrete, Transportation, Medical, Enterprise Mobility, BPR & ERP, to name a few. He received Bachelors’ Degree in Electronics & Communication Engineering from IIT Roorkee, Masters’ in Software Systems from BITS Pilani, and PhD in Management from BIT Mesra.
2017 (https://www.economist.com/leaders/2017/05/06/the-worlds-most-valuable-resource-is-no-longer-oil-but-data)
[1] Dr. Jyotirmoy Dasgupta had a distinguished International professional career spanning over four decades. He has significant experience in domains such as BFSI, Manufacturing – process and discrete, Transportation, Medical, Enterprise Mobility, BPR & ERP, to name a few. He received Bachelors’ Degree in Electronics & Communication Engineering from IIT Roorkee, Masters’ in Software Systems from BITS Pilani, and PhD in Management from BIT Mesra.
2017 (https://www.economist.com/leaders/2017/05/06/the-worlds-most-valuable-resource-is-no-longer-oil-but-data)
Blockchain based secure tokens can be mentioned as one more advance. These tokens are being used increasingly to gain insight into transaction patterns aiding better decision making. Cryptocurrencies have been bit disappointing though, as person to person (P2P) money threaten fiat money based monetary systems, and sovereign governments feel threatened by these parallel economies.
Fraud detection and prevention on both real-time, and predictive basis help banks and financial institutions to offer quicker and better decision making while handling transactions or offering services.
Emerging terms like InsurTech, RegTech represent newer frontiers that financial analytics are set to conquer. The list is long, and space in this publication limited. We will end by observing that exciting times are ahead indeed for analytics driven FinTech enthusiasts.
Dr. Jyotirmoy Dasgupta
Professor & HOD – FinTech, ITM B School, Navi Mumbai