While big data is revamping FINTECH industry organically and is still in its infancy mode. The question arises whether experts utilizing big data are using to its fullest capacity or is there scope to do more in this sector? If there is a scope will it lead to better utilization and more innovation in sector and how to address this space better?
Please read our opinion further and share your valuable opinions .
While Big Data has helped FINTECH evolve like never before. It also has roped in traditional consumers with confidence and making them use data analytics to improve their customer experience. But this leaves us with a void as to whether the providers are utilizing big data to its fullest capacity or is there scope to do more?
While regulators like RBI have already allowed a sandbox mechanism to promote and facilitate innovations, we reason as to why this will lead to better utilization of big data and more innovation in the FINTECH space.
- It helps in better Pricing, Risk Assessment to create a optimum Sales Strategy
While FINTECH industry is sitting on a copious amount of data they are not able to use it to the maximum efficiency. The reason is lack of data digitization. Further digitized data can be spread across at ease for different systems which are integrated virtually within companies. Also lack of credible third-party data becomes an issue. Several providers in FINTECH space have started implementing big data approach for marketing campaigns. There is ample scope for efficient decisions based on big data not just in customer-facing functions like sales or claims servicing but across FINTECH continuum in areas of product development, pricing, risk assessment, fraud and credit inventory management. While challenge for Fintech industry lies in innovating products and creating better distribution channels to serve customer needs. Sandbox can help to open new innovations to be tried on a smaller scale and bring in ability to try different ideas internally and externally, and in some cases partnering with competition. In the long run, it will help introduce more innovations to market thus benefitting FINTECH sector at large.
- It can help in better Product Customization for Behaviour Analysts
FINTECH based products will benefit from big data. Vendors will also have a handful of products in each category to be used across distribution channels. This one-size-fits-all approach fails to serve a heterogeneous population. The regulator can recognize and plan for streamlined FINTECH based product planning. As Customer needs, perceived values and affordability varies substantially. There is much to learn from consumer goods sector, where products are tailored for each customer segment like introduction of sachets, product positioning at aisles and billing counters etc which have served the consumer goods sector well. FINTECH sectors have a lot of data that is not leveraged fully. Behaviour analysis at different stages of the buying process should throw insights on factors that influence purchase. This understanding can then be used to customize products and test them in a controlled environment.
- Helps Providers to Innovate and Test for better products
The FINTECH industry enjoys a large amount of data. It’s been used traditionally to either up-sell or service customers better or to detect and prevent fraud. Data scientists are able to further leverage technologies available to create enhanced customer engagement. Nevertheless the biggest challenge it has is level of data-sharing capability and capacity within players. Further, we should be able to have a system towards sharing information that is within the guidelines of the privacy norms and ensuring there is no misutilisation of data that is shared. Sand-boxing approach gives us encouragement to further innovate and test products and services that benefit the consumer. Tech-enabled services for customers and sales force alike reduces time and increase efficiencies. The next phase for players will be on how to make these processes faster and simpler.
- The Ground Work Data needs to be mapped to Cloud to Collect and store Relevant Data
There is a long way for Indian FINTECH industry to go in terms of using big data. With no physical products to manufacture, data is arguably the most important asset for service providers. Providers are now developing better products, processes that use large amounts of data to assess price and predict or prevent product or service risks that were considered void in some instances. The industry can revamp modes of distribution by capturing data upfront where most of the data is provided. It also needs a lot of groundwork in terms of creating awareness among intermediaries, service providers and consumers. It also helps regulator to check benefit and viability of an idea before enabling a full launch in the sector over other competitors. This will certainly accelerate innovation and help providers deliver better products. The challenge lies not just in improving the Asset quality but also preventing the slippages.
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