More organizations are becoming increasingly aware of the benefits of analyzing the large amounts of data they currently possess and are continually generating across many different touch points with their customers and everyone they interact with including employees and business partners. With the right big data solution companies are able to pinpoint problems areas so solutions can be found, and exploit opportunities to generate more revenues. A new report by Ovum examines the use case for big data in banking, and predicts it will drive spending on management information systems (MIS) to $9.3 billion by the end of 2018.
According to the report the expenditure is to improve analytics of the explosion of data that is taking place not only in the banking industry but in IT as a whole. The report predicts the growth is going to increase between 5.3 percent and 6.4 percent from 2014 to 2018.
The challenges the banking industry specifically faces are based on recent events such as the multibillion-dollar settlement of J.P. Morgan and others. Bankers are keenly aware of the new compliance regulations they have to obey in order to avoid heavy fines. The increase of technology expenditure in banking is to generate revenue but just as important is finding solutions that will allow them to tackle risk and compliance management issues.
With big data analytics bankers will be able to improve Web security, customer analytics and compliance, but it will require an understanding of what data is and putting the right governance in place to ensure the information is used properly. As the report outlines, data has to be treated as enterprise assets and all the precautions that entails.
The report answers key questions about big data including how it should be leveraged for current and future initiatives, and how to facilitate the launch of a big data project in their organization.
"The ideal solution requires a combination of people, processes and technology. Data from customers, banking channels, back-office systems and third-party sources can yield significant insights that are useful for customer marketing, risk management, and infrastructure optimisation, alongside a host of other areas,” says Jaroslaw Knapik, senior analyst, financial services technology, Ovum.