By Vinod Ganesan, country manager – India, Cloudera
Digital banking is at an all-time high – in line with the growing use of smartphones and availability of affordable data. India is also now the second largest fintech hub, second to the US, with around 2035 startups operating in this space according to the India Fintech Report 2019 . Consumers increasingly have an option of using services offered by non-banking financial companies and fintech firms which brings traditional banks to an important juncture. With newer competitors entering the fray, banking pioneers must make innovation a dire necessity in order to stay competitive.
Taking on a different approach to the competition
Banks should focus on creating new value instead of trying to catch up with existing and new competitors or simply contributing to apps and services that are a replication of what is already out there. Finding, developing and nurturing a new market space is a far easier thing to do and one can become a disruptor in their industry.
A clear understanding of ongoing trends and the industry situation at large is key for any player in this space. One needs to study this constantly evolving business landscape in order to make better-informed and more accurate business decisions. Once banks unearth the problem areas of the industry, they can use this information to reimagine market boundaries and identify potential new customers for the industry. Before the plan has been put into action, it would be imperative to construct a roadmap to achieve your goal which aims to deliver new value to customers through it.
Data is crucial for each of the steps mentioned above. Fortunately, we are currently in a digital age where the growth of data is on an exponential rise. IDC predicts that the collective sum of the world’s data will grow from 33 zettabytes in 2018 to a 175ZB by 2025, for a compounded annual growth rate of 61 percent. However, only 43 percent of ASEAN companies in 2019 were using big data to enhance their businesses, according to AOPG Insights’ report titled “The ASEAN Appetite for Data in Motion” .
Transforming big data into actionable insights
Banks also need to ask themselves how they can successfully leverage the wealth of opportunities that big data presents. One way to do this comprehensively is by using an enterprise data cloud. With the help of an enterprise data cloud, banks can acquire clear and actionable insights from complex data anywhere. An enterprise data cloud provides:
• A flexibility of choice in terms of choosing where and how to store and manage data and an infrastructure through a platform that is optimized for hybrid cloud deployments
• Ability to democratize their data without risking compliance and regulatory requirements
• Implementation capabilities across different types of use cases all in one platform and one copy of the data
• Openness through open source to avoid vendor lock-in and an open architecture wherein interoperability is not an issue with other data management vendors in their ecosystem.
The insights derived from these analyses should then be used to decide on profitable opportunities including customer demands that haven’t been met and those that the industry has yet to recognize. Banks can also use it to address and develop strategies with the intention to create more demand. An enterprise data cloud creates workloads so as to move quickly across various cloud environments as and when needed with fewer concerns around security and governance. This helps executing new plans by accelerating innovation.
Axis Bank is one such organization that has been able to realize the benefit of adopting an enterprise data platform. With over 20 million customers and more than 4,000 branches across the country, they faced a challenge in extracting value from unstructured data sets and achieving real-time insights across major business units of the bank.
With the help of an enterprise data platform, the Indian bank has been able to improve their operational efficiency thereby improving performance with the help of better insights. Their data driven approach also helped them maintain costs against industry levels and further expand the bank’s business through improved targeting. They have been able to develop a deeper understanding for the business’s needs since their improved capabilities of being able to analyze 40-50 percent more data than before the deployment of an enterprise data platform.
Stiffer competitions, shrinking budgets as well as resources can make the future seem bleak for banks unwilling or hesitant in harnessing the power of data for business transformation.
It is important to look for opportunities to disrupt the industry instead of complying and responding to competition. This can be achieved using an enterprise data cloud and by leveraging it for insights that can help identify, create, and protect new markets, thereby making competition irrelevant and differentiating from competition.