Big data has changed the way the financial services industry operates. Additionally, the tool has the potential to alter things even more. The sector is experiencing a period of what John Guevara of financial services company Actian called a significant transformation in an interview with B Eye Network, a business news site. What will happen in the future is hard to predict, as big data technology is still something that hasn't been carefully analyzed in terms of the possibilities it contains aside from how it has been used currently.
The Financial Times chose to predict the future of banking by suggesting that institutions send out a financial newsletter to their customers with predictions about their behavior for the following month. In theory, it could also track the number of times someone visits particular stores and offer incentives for shopping at different places. As it stands, all of these things could be done right now, but they would take a lot of time. With more sophisticated computers on the way, much of this work would happen automatically in the future.
Banking may become more personalized even as the basis of this lies with pooling together thousands of statistics and analyzing them dispassionately with a machine. It must be understood, however, that the tools are still being finessed and perfected.
"Big data is a big opportunity, but we've got to sort a lot of things out along the way," said Greg Baxter, global head of digital strategy at Citigroup, to the Financial Times. "But there are still a lot of 'small data' opportunities that can make a big difference – we're trying to make managing financial health a more integrated part of our client's life, so we're experimenting with providing clients with early warnings of potential cash flow problems in their accounts, for example."
Figuring out the best methods for leveraging big data
Like other industries, it's hard to figure out what to do about the recent technological innovations that allow powerful computers to process thousands of transactions in a matter of seconds. It is likely that human resources management in the banking sector may need to consider hiring people who are experts in big data. B Eye Network cited concerns about privacy, and there is the possibility that this will be a major topic as more companies begin to track their customers' data on large scale. Hiring the right people for this job will soon become considerably important.