How Big Data is changing the Finance Sector and Fintech Companies?

Alone in India, 600 million smartphone users are there and the number is continuously expected to grow. A lot of data is generated by users on a daily basis and it’s a goldmine for the companies. Big Data is useful in gaining valuable insights. It helps companies incorporate customisable experiences for their user. Big data is complex and voluminous sets of diverse information. Big Data has three V’S volume, velocity and variety.

• Volume: The collected data by the end of 2020 was 44zetabytes.Sophisticated algorithms can filter it and can extract meaningful sets of information about individual customers.
• Variety: Data is no longer limited to Excel spreadsheets or photos on a hard drive. Big data have information on video, audio, text messages and many more. Structured data is needed by fintech as it is organised information needed by them, whereas unstructured data is an unfiltered set of data that needs sorting and processing with a variety of information in it.
• Velocity: Artificial Intelligence(AI) and Machine Learning(ML) play a significant role in analysis. With advanced analysis systems, it can collect, process and act in a blink of an eye. Fintech companies are working on data science to analyse these data to evaluate customer risk and their behaviour. Companies can give a customised experience to their user and can segment them. As there is no queue in banks because all the services are now available online, FinTechs get to know the customer all around and at an almost personal level. Fintechs are needed to know the customer spending behaviour and their financial habits. It helps analyse to give the credits a user could have upon their habits. This helps in understanding the user and making changes in policy as well as user interface giving a good user experience.

Fintech can give unmatched customer service which a traditional bank cannot do through the help of big data. The customer now doesn’t need to think about getting any services at any time. Now you don’t need to wait hours to speak to the account manager.

In the digital era, fraudulent activities are one of the biggest concerns for companies and consumers. Big data helps fintechs develop reliable fraud detection systems by spotting unusual activities. This makes a healthy connection with customers as their trust is important and if they feel secure then only they will use the service and will recommend others as well. Contactless cards are great examples of a fintech development that enhances customer experience. Creating an experience that maps across the multiple channels that consumers use to interact with businesses will also be crucial.

Data is collected by every device like a smartphone, laptop, TV, etc. A tremendous volume of data is generated. To get information from these we use big data analytics to cater to this Fintechs are used to make robust solutions for these. Big Data and Big Data Analysis are different as big data is the accumulation of data and analysis is taking information from accumulated data. With big data, we can target when the client would need any services or products.

If you enjoyed this article, you might find our pieces on How Indian Fintech Startups are bridging the urban-rural divide by changing rural India’s landscape of some interest.