How business intelligence can help Fintech businesses
Considering the large volume of data financial sectors disperse across applications, achieving a 360-degree view of customers and business as a whole can be challenging. This is where business intelligence for the financial services sector comes into play.
A robust banking business intelligence solution enables financial institutions to convert a large amount of data into actionable insights. Organizations further use these insights for better strategic planning and decision-making.
BI capabilities center on customizable, built-in dashboards that allow for real-time analysis based on business goals and objectives developed from the information coming from a central database. Financial leaders can identify fintech trends and opportunities and drill down into any underlying metric or transaction for greater detail.
Today, in this article, we will dive deep to understand the benefits of business intelligence for the financial services sector and answer one of the most asked questions, ‘’How can I use business intelligence in my Fintech business?’’
So, without further ado, let’s get started!
Why is BI important to financial companies?
Business intelligence tools can help the banking and finance sector stay competitive and financially stable by providing fast access to detailed cash flow insights, expense management optimization opportunities, and the ability to make better decisions about costs and profitability, thereby increasing overall business performance.
BI-driven insights also help finance professionals become more efficient at their jobs and adept at knowing what actions promote growth. It also helps finance teams reduce risks with techniques like data-driven spend management that identifies and eliminates rogue spend and invoice fraud.
With successful BI strategies and tools, the financial services sector can also leverage historical data more effectively to look into the future. This, in turn, makes it possible to create forecasting models that yield more accurate insights.
Now that we have understood the importance of BI for financial companies, let’s understand the key role of BI in finance.
How is BI transforming the financial industry?
By displaying current and historical data, business intelligence assists financial firms in identifying competitive advantages and making better data-driven decisions. It also helps banking companies to embrace innovation and reap the rewards of having actionable insights.
On that note, here are some ways in which BI is transforming the financial services sector:
Reduces risks: Many banks and financial organizations use BI tools along with machine learning to mitigate risks and detect fraudulent activities in real-time. The ability to track customer transaction histories allows banking institutions to quickly detect suspicious activities and reduce such incidents.
Financial services business intelligence also gives organizations the ability to accurately estimate the risk of customer loans based on various data points, including financial assets, earning capacity, and more. BI tools can also monitor employee behavior to prevent insider trading and ensure compliance with industry regulations.
Boosts customer retention: Banking business intelligence tools can keep marketing and sales teams armed with the most current information on customers. They can help identify an organization’s most loyal and profitable clients to market relevant products and services and increase customer lifetime value. Conversely, financial institutions can take information through BI to make less profitable customers more profitable.
Financial services business intelligence tools can also gather product-specific information to determine how services can be enhanced to retain customers and which product lines should be shelved to protect profit margins.
The ability of these tools to track consumer habits and preferences allows organizations to tailor their products in ways that meet needs, solve problems and enhance customer experience and loyalty.
Improves financial products and services: With the help of business intelligence tools, Fintechs can keep a check on their revenue streams to assess the profitability of financial products and services. After identifying which products are performing well and which are not, they can make informed business decisions on everything from marketing to pricing.
For instance, Amex has been using BI to develop new payment service products and market offers to customers. They can identify users that will close their accounts within four months using BI tools. This, in turn, helps American Express take effective steps to retain those customers who would otherwise be lost.
Offers competitive edge: Business intelligence in financial services is helpful in comparing product or service offerings with your competitors to uncover ways of strengthening your competitive position in the market.
For instance, when it comes to using personalization to gain a competitive advantage, the financial sector is witnessing exceptional benefits from BI tools that enable them to customize products on the basis of available customer data. The information can also be used to monitor market trends to plan new investments, predict customer behavior, and ensure existing products are in accordance with customers’ needs.
Improves marketing efforts: Using BI in Fintech, marketers can analyze Customer Relationship Management (CRM) data to get an insight into the profitability of marketing campaigns. In addition, the customer base can be analyzed for identifying and developing new upsell and cross-sell opportunities.
Business intelligence in financial services can also be used to measure advertising spending, email marketing performance, and the campaign’s overall success. This will, in turn, reveal where your organization’s messaging resonates and where it falls flat.
Increases operational efficiency: Business intelligence and analytics tools help banks and financial institutions to assess operational procedures, resource allocation, and the performance of employees. BI can also help identify the areas where the financial sector can cut costs, improve the customer experience, and maximize operational efficiencies.
For instance, by analyzing the customer-facing employees, such as sales personnel and account managers, financial organizations can discover new ways to improve and enhance the customer experience at the point of contact.
Seamless collaboration: The business leaders have to work with different departments such as marketing, finance, and sales in a financial organization. From allowing the sales and marketing teams to brainstorm and share information seamlessly to setting up the budget for customer acquisition, BI in Fintech helps create a healthy environment in the organization and promote collaborations between employees and stakeholders.
Final thoughts
In this era of enterprise digital transformation, business intelligence is a must-have for any financial organization that wishes to gain a competitive edge. It allows organizations to gain better insight into their organization’s past, present, and future to make informed business decisions. To accomplish this, business intelligence in banking collects, organizes, and analyzes crucial KPIs. This leads to increased revenue, improved sales intelligence, and efficient inventory optimization.
If you are unsure of how to go about implementing business intelligence solutions for your financial organization, you can consult a trusted business intelligence software development company. The experts will offer top-notch enterprise business intelligence solutions and services in the form of implementation, consulting, and support and make the BI implementation journey easier for you.
