By Anurag Sanghai, Principal Solution Architect, Intellicus Technologies
The new generation of ‘digital native’ consumers is relying on much more than traditional banking products to use their money in the present and make it grow exponentially for the future. They increasingly seek digital technologies, resources and live access to their financial data to take control of their personal finances.
With large volumes of data flowing in from many varied sources, financial service providers must rely on business intelligence (BI) to process data and provide deeper insights into individual customers’ financial behavior. The advanced analytical and pattern recognition capabilities in BI platforms can help financial businesses provide their customers with adequate control over their finances. This article is aimed at discussing how this coalition of technologies can help people manage their personal finances.
Comprehensive Financial Visibility: The investors of today diversify their savings into multiple investment avenues. They need a holistic view of their data including investment trends and portfolios, accounts and credit history onto a universal dashboard. BI can help financial institutions offer a combined view of all the information related to a customer’s expenses, income, investment and savings to offer better visibility into the current state of their finances. With such in-depth access to their finances, customers can feel confident about their financial decisions.
Intelligent Budgeting for Improved Financial Health: Capable of analyzing spending patterns and identifying areas of overspending, BI tools can help individuals gain a comprehensive understanding of their personal finances. Instead of analyzing transactions individually, these platforms offer contextual analysis and provide tailor-made insights to improve customers’ financial health. Using BI tools, financial service providers can categorize information into meaningful groups so that consumers can compare them against goal-based benchmarks.
Better Investments with Personalized Recommendations: With abundant historical data at their disposal, financial institutions can accurately forecast expenses and opportunities. Coupling this information with an individual customer’s financial goals, experts can use BI tools to provide personalized recommendations. This empowers customers to allocate their financial resources effectively based on their income levels, spending plans and risk tolerance.
Advanced analysis of market data, risk profiles and trend predictions can empower businesses to suggest potentially profitable investment avenues and savings plan to customers, helping them build a diversified portfolio. BI and ML tools can also tailor credit offerings with relevant cashbacks, travel rewards and various other benefits to match a consumer’s needs.
Risk Profiling and Minimization: Markets react differently to different stimuli and financial analytics can couple current market trends with historical data to predict market behavior. Using BI tools and ML algorithms, experts can assess customer risk tolerance and provide customized investment plans. BI platforms have built in what-if analyses to simulate potential market trends and develop plans for risk minimization. Armed with advanced analytics, financial institutions can empower customers to minimize risk exposure and hone their investment philosophy.
Retirement Planning and Investment Tracking: Predictive models created by domain experts can chart historical data to observe market cycles and predict YoY market trends for longer durations. Such in-depth analysis can help investors set realistic goals and maximize their potential returns. Real-time tracking can provide insights into individual income growth and compare it with inflation numbers, helping customers chalk up an incremental investment plan. A long vacation, a dream house, children’s education or clearing debts – BI tools can offer optimized plans to achieve every goal through strategic investments.
Formulating Tax Optimization Strategies: Measuring customer expenses and investments against income, financial analysts can offer strategies to optimize tax planning. Valuable insights into the calculation of tax credits, possible deductions and exemptions can maximize tax benefits and minimize tax liabilities. Every investor wants to be on the good side by avoiding government penalties. To achieve this, they can leverage company resources to receive timely notifications to explore tax-saving instruments and stay updated on tax-related deadlines.
Credit Discipline: By offering transformative tools for effective debt management, BI and ML play a pivotal role in improving financial stability. A combination of diverse factors such as payments track record, debt history and prevailing interest rates form the basis of an individual’s credit-related decisions. Modern platforms allow investors to check their portfolio at any time to assess their current financial status and develop financial discipline. Insights from data analytics can help customers strategize repayment methods that align with their unique situation, keeping them on the path of a secure financial future.
Data-driven recommendations provide valuable guidance for refinancing possibilities, debt consolidation and repayment plans. Individuals can use this information to navigate the financial landscape perceptively and avoid potential pitfalls by making informed decisions that lead to stable and balanced financial portfolios.
In conclusion, Bi and analytics deliver a transformative approach to tailored guidance, risk assessment and continual monitoring to revolutionise every individual’s personal financial management. A comprehensive integration of technology empowers individuals to navigate their financial journeys more effectively by fostering improved financial stability and ensuring long-term prosperity.
