The Golden Age of Data in Financial Services

Financial services is a data-intensive industry in which banks and insurance companies have historically held large quantities of information.

The development of the internet, the increase in new channels, and the introduction of technologies including cookies and trackers have helped not only to create a better user experience, but also to exponentially increase the amount of collected data, for the most part dark data. With the availability of new digital technologies and a higher degree of interconnectivity and interactions, new data sources have emerged that are a potential treasure trove for businesses. 

Up to the early 2000s, organisations held their data pools within the boundaries of their own technology infrastructure. During the dotcom era, PC accounting software emerged that, as one of its many applications, started to allow the screen scraping of account transaction information as input into personal tax calculations. 

Designed to force competition in the banking market by making the banking data available to new types of financial services providers, Open Banking initiatives were initiated by several regulators, creating new opportunities for value propositions and better serving customers based on their data. Whilst the uptake is slow in some markets due to the need to develop consumer confidence in data sharing, Open Banking is already evolving into Open Finance as the roll-out of  APIs and the availability of data is extended to additional products and services.

CRIF Digital shows that the value to financial services organisations, and to their customers, includes an increased redemption rate, better risk management and risk profile quality of their lending portfolio, to name just a few. These are proof of the potential value held in data.