The word ‘data’ is tossed around a lot today, but it’s no trend. Data is the lifeblood of commerce, and its importance in commercial banking cannot be underestimated. To parse the idea a bit finer, it is not just the data itself that is relevant, but also the ways in which a commercial bank can access and leverage that data in real-time.
In this article, we’ll explain the reasons data is important for a commercial bank in 2022, including:
- How it transforms internal processes
- How it saves banks time and money
- How it gives banks a competitive edge
Reduce Human Error
Compliance in the financial services industry is of paramount importance. And with the sheer amount of information required for compliance, even the most experienced CPA is bound to make an error at some point or another. However, the best solutions out there have several layers of business logic built into the software to mitigate errors.
A solution such as FlashSpread, for example, has failsafe error detection so robust that it has even identified CPA errors in data. With the speed of applications and transactions these days, it provides the kind of consistency and reliability every commercial bank needs.
Manual data entry has been a chief burden in commercial banking for some time. It is exhausting and adds hours to application processing and distracts bank employees from more productive tasks.
Digitized data not only spares employees from the tedious and time-consuming data entry, it also enables them to speedily access, analyze and leverage that data for insights. With the right data tools, you can use real-time data to make faster, more informed credit decisions.
When you save time, you save money. In commercial banking, however, the real bottom line often rests on credit decisions. Making data-driven decisions means that you will make better choices during the credit approval process, leading to healthier EOY stats across the board. In fact, banks that exhibit data maturity by way of big data solutions achieve an average 61% return on investments.
Pain points ranging from high costs to service to compressed margins add up to make today’s digital landscape problematic for commercial banks. Big data, advanced analytics and the powerful combination of machine learning and AI all have enormous potential for ameliorating those pain points.
Data Gives Banks a Competitive Edge in a Rapidly Evolving Market
It seems that every day there is a new disruptor out there redefining banking and finance. While banks were slow to adopt new technologies, it is clear at this point that keeping up with digital transformation is essential.
Commercial banks that learn to leverage data effectively will not only see results, but see results that serve as differentiators for them against competitors. Accessing and leveraging real-time data in innovative ways will make commercial banks newly relevant against emerging payment platforms, fintechs and the like, and lead to increased revenue, reduced operational costs and a more loyal customer base. After all, bank customers already understand the preeminence of data. Isn’t it time that banks do, too?
Data Is Everywhere
Every industry is learning to leverage data in real time. The Internet of Things, social media and apps have all made data the ‘language’ in which we all speak and do business.
Because of the industry’s strict regulatory scrutiny, banking data has long been siloed, monolithic and stagnant. Many manual processes, workflows and policies that haven’t evolved since the 1930s. Today’s most innovative data management solutions unlock that data and provide banks access to a plentiful and ever-renewing resource.