Banking on Real-Time Analytics for Better Customer Experience

real time analytics in banking
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The digital storm has now made its presence felt across various industries and the banking and financial sector is also not far behind. The way customers interact with banks is not the same anymore. Things have become “in-the-moment” and banks need to be responsive as things get up to speed. Customers have become so used to mobile and online banking, that it’s taken for granted that a good banking experience would definitely involve them.

The standards for marketing efforts are not being set by other banks alone but by tech disruptors of the ranks of Google, Amazon, and Facebook too. Another important development has been the rise of fin-tech startups that have convinced the younger generation to rely on digital media of banking instead of the traditional ones.

The banking industry has to now drive innovation keeping a data-centric approach in mind. 

There’s an unimaginable amount of data in banks which pertains to customer information, transactions, pricing, and bank operations. The real challenge is how to put this data into action in real-time and capture the customers’ attention within a critical moment which spurs them to act. 

Where does Real-Time Analytics step in?

What acts as an advantage for the banking industry is the plethora of touchpoints that a customer has with the bank – opening an account, cashless transactions through debit cards, credit card information, loans & mortgages. Although such a vast reserve of information may prove confusing if you are not aligning all data points in real-time with customer engagement strategies, then all this data will stand nowhere.

For instance, if your data says that a particular customer is reviewing his investments often, then luring him with a personal loan is not going to be of any use. Perhaps a complimentary call with an investment advisor would be a better option. The banking industry cannot be left behind when it comes to such hyper-personalized experiences to cater to a digital-native audience.

However, Personalization cannot stand alone when it comes to differentiating your organization. It has to be combined with speed to win the digital race. Real-time analytics in banking helps organizations to respond at lightning speeds. Alibaba’s 3-minute loans are a classic example. 

Jack Ma’s online bank tapped the power of real-time payments, artificial intelligence, and risk management system to extend loans worth $290 billion to 16 million companies. The loans can be availed within 3 minutes after a few taps on a smartphone. All this was achieved with a 1% default rate. Such is the power of real-time analytics. 

Alibaba’s example highlights another competency of digitally-driven banks – the rapid speed to cash. Transactions happen online within minutes, and the cash is also deposited the same day. This is a far cry from traditional banks where paperwork, execution, and the decision process may take days or even weeks. 

Banks have to reach customers in micro-moments

What’s that one factor that can help an organization differentiate itself in a digital world? We believe it’s a unique, real-time experience that customers can remember.

But how does real-time analytics in banking help deliver an experience that stands out? Let’s try to understand this. 

Although many financial institutions are using data analytics tools like Hadoop & HBase, which is great when it comes to batch processing. Since data is processed in regular time intervals (once in a day, for instance) batch processing is nowhere near real-time. Hence batch processing is no longer appropriate for modern banking requirements. 

Enter real-time streaming analytics. Today, banking has become 24/7 with transactions happening any time and from anywhere. A scenario like this demands that businesses capture the attention of their customers within micro-moments else they lose their opportunity. Disruptors like Alibaba are setting the benchmark for other banking and finance organizations by dishing out loans within minutes and at the precise moment when their customers need it. 

Personalized recommendations have now leveled up. Staying ahead does not only mean putting the right product in front of people but making it happen at a precise point in time when it will make the maximum impact. 

Consider these findings revealed in the Accenture Banking Technology Vision 2019 –

  • 87% of banking executives have acknowledged that the union between customization and real-time will set the tone of competitive advantage in the future. 
  • The same report states that only 38% of these banking executives have seen their organizations prioritizing customization.
  • Further, only 9% are focusing on on-demand delivery.

It’s quite evident that despite immense opportunity in real-time analytics in banking, organizations are unable to exploit it to its full capacity. There’s a huge gap between what executives have in mind and what they are putting in action when it comes to real-time analytics in banking.

If you are considering integrating real-time analytics and haven’t been able to do so, you’ll be living in the past. To gain a competitive advantage, your banking business needs to be more agile and real-time analytics in banking can help you respond to your customers in an instant. 

Banks should update their technology strategy to be prepared for the demands of momentary markets. They should include modern streaming technologies to enable APIs, in-stream decision making, analytics, Artificial Intelligence, and more to stay ahead. Download this infographic to see how modern streaming technologies and Fast Data solutions are helping the banking sector in different use cases.

Few organizations understand real-time streaming technologies like Knoldus does. To be able to enable streaming, one has to think in terms of passing time windows and not databases, events, not records functions not objects. Let Knoldus help you grab micro-moments in real-time! Drop us a message here or at hello@knoldus.com and we’ll help you get started.

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Written by 

Niharika has around 3+ years of experience as a Content Professional. She loves writing about technology and the latest trends in the online world although her rich writing experience spans across diverse business domains. Apart from writing, she has also worked on YouTube audience growth strategies. An ambivert by nature, she likes to grab a snack with a warm cup of coffee accompanied by a good book or a close friend.

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