Article | June 1, 2021
The axing of third-party cookies by Google and the other major browser companies will require a major readjustment by financial services organisations.
The decision, coming fully into force next year, will effectively choke off the data that has enabled personalisation, optimised website interactions and driven much internet advertising. It is no comfort that the browser companies have acted because of fears about infringement of privacy and data protection legislation such as the EU’s GDPR (General Data Protection Regulation) and the CCPA (California Consumer Privacy Act) in California.
The move will affect how UK financial services organisations interact with millions of people. More than three-quarters of Britons now use online banking and 14 million use digital-only banks, expecting a slick, light-touch interaction. So it appears that just as many people go digital, financial services organisations will no longer have access to information they need for personalisation, being unable to track where customers go on the internet after they have visited a bank’s website. All that data about individuals’ habits and preferences will be unavailable.
It seems catastrophic, but in reality, it is not. Financial organisations have a new opportunity to radically improve how they interact with web visitors and customers. AI-powered behavioural analytics offer far superior, real-time capabilities, using the data from the first-party cookies on their own website domains and where available, data from customers’ transaction histories.
The result is a solution that is faster, more accurate and responsive than conventional technology relying on cookie data owned and stored by third-party organisations. Instead of relying on such data for relatively rigid profiling and personalisation, behavioural analytics enables real-time interactions based on a more dynamic picture of how an individual’s requirements are changing.
The technology analyses all the browsing characteristics including time on site, speed of movement and page views, as well as more obvious features such as interest in specific products. Historical data added to the analysis includes what customers did on previous visits and the interval between those visits, establishing patterns where possible.
The flexible advantages of behavioural analytics hubs in financial services
Segmentation allows a bank to identify customers as soon as they arrive on its site, according to whether they are a new or existing customer. Their behaviour then indicates what they want. Knowing what customers are interested in is important. Customers visit financial services websites for a host of reasons – from seeking information, to opening accounts, exploring loans and mortgage offers, making or setting up new payments. They may also want advice about investments and savings, pensions or small business finance. Almost all of these requirements involve quite complex mental processes which financial organisations can influence while consumers are on their sites.
Collecting the data is not difficult – the skill is in making it actionable in an effective way, replicating the ability of a perceptive employee to read a customer’s state of mind. Banks can do this by setting up a behavioural analytics hub to understand what a customer’s behaviour means and how it can be optimised.
Using customised parameters, the hub will, for instance, trigger a screen notification that prompts the web visitor to fill in a form requesting an appointment. In the case of existing customers, the technology can correlate health insurance offers with spending on fitness, and, in general, savings and investment recommendations can be tailored to the client’s concerns or goals as revealed by their navigation of a bank’s website or mobile app.
Banks can set up analytics to see when consumers are behaving in a way that indicates they about to leave the website, allowing them to intervene with a notification that could include an offer. This provides a positive outcome and avoids the blanket use of offers that undermines profitability.
It is a more sophisticated and personalised approach that avoids annoying pop-ups or recommendations that fail to match individual preferences. As part of a single AI-powered segmentation platform, the technology enables banks to personalise marketing content in SMS messages and emails sent to consumers (who consent), which deliver far better results through precise targeting.
Solutions for last-mile interaction in the open banking era
The single platform approach also has another major advantage. It is much easier to implement and far more efficient and streamlined compared with separate solutions for different parts of the customer journey.
The benefits of using AI-powered segmentation solutions should be part of the financial sector’s broader strategy to transform its systems for the open banking era as we approach the end of third-party cookies. For established banks, the reality for some time has been that complexity of systems has undermined their ability to deliver a high-quality last mile. This they can now address without huge disruption or investment.
The alternative is for financial services organisations to become lost on an ocean of data, losing track of customers. Behavioural analytics will bring banks new insights into customers that surpass third-party cookie data, being actionable and accurate and in real time. To provide a streamlined and profitable experience for themselves and their millions of customers, banks must now employ the latest advances in AI-powered behavioural analytics.
Article | June 1, 2021
People know their banks and their favorite fintech applications. However, consumers are generally not aware of data aggregators like Plaid and Finicity, which collect consumer data from banks, crunch it and feed it to fintech applications. Blockchain technology can play a key role in helping data aggregators manage consumer financial data while complying with regulations and empowering consumers.
Article | June 1, 2021
Before I begin…good news for people nervous about the stock market panic today…. CNBC is airing a ‘Markets in Turmoil’ tonight. It never has failed at producing an investable bottom. If you are confused or angry…you might be too heavily weighted in stocks. The warning signs have been epic. Read Ben Carlson’s excellent piece titled ‘markets have always been rigged, broken and manipulated ‘.
Article | June 1, 2021
How Blockchain is Changing Banking and Finance Industry
We all have basic knowledge about Cryptocurrency and Blockchain technology, and many peoples understand its complex structures and its valuable benefits for the future. That's why many peoples believed that it's the future of currency exchange. Apart from Cryptocurrencies like Bitcoin, Dogecoin, Etherium, etc., Blockchain has the potential to use the existing technology up to its peak to exchange transaction information and data. With more security and easy to trace back previous transactions benefit, we can say it is the new age of Electronic currency to avoid human errors and frauds.
Blockchain technology in Banking
Around the many conspiracies and fake theories about Blockchain and Cryptocurrency, many organizations and even countries like Australia, China, Japan, and other developed nations embraced this Blockchain in Banking as a future of seamless exchange of transactions.
Apart from that, its decentralized transactions are easy and more secure than we have today. Blockchain could change the current banking technology used by its admins to trace and track the record of every exchange of digital money to lessen the frauds and reduce the time and human efforts.
Prominent players of the Bank and Finance Industry like the Bank Of America, JP Morgan Chase, Citi Bank, and other renowned players of finance sectors using Blockchain in banking to improve funds transfer between banking institutions globally and maintain every record of their history of transactions effectively.
How Blockchain is helpful in Banking
Blockchain technology is a decentralized ledger of transaction which enables the bank to keep track of all the transactions publicly and transparently. It provides a direct connection between the sender and receiver of payments. No intermediary and complete control of the transaction exists in between them. Because of this reason, it provides a way for financial services to work more specifically and without errors to make payments securitization more precisely. This makes Bitcoins that uses Blockchain technology a better option of investment.
Benefits of Blockchain in Banking
As you continue to read this article, you might have an idea about this new age technology's immense benefits in the finance sector. Let's take a look at how it can be more helpful in the upcoming future.
The primary concern of 21st century’s banks is their security. No one knows who will hack their systems and scatter with the money of people who trust the financial system. With Blockchain technology, security issues such as suspicious activities are easily tracked. It is hard to decode the encryption of the Blockchain and takes too much time because the data is not stored on one server but across a huge network of computers. These computers constantly check and verify the records and data. This feature allows a noteworthy use for Blockchain in banking. For a hacker, it is hard to breach many servers.
Every transaction that gets recorded in a Blockchain ledger undergoes complicated sets of encryption interconnected with the next block, which results in an unaltered series of coded data "blocks," each dependent on a ledger series. That's why it is one of the best cyber-protection against hacks in this internet world.
If you want to transfer money to someone living in another country, you go to the bank and might have to stand in the long queue for your turn. Once you forward your request, it takes 5 to 10 days to credit the amount in the bank of the recipient. Blockchain can easily reduce such a long time-consuming process. It has the potential to complete the transaction within minutes, not in a day. It saves your valuable time, though.
Easy to track and transparency:
No doubt that it is a highly transparent and traceable system as compared to the traditional finance system. Every record of amount can be easily tracked with a digital recording system. It reduces the need for time-consuming and costly third-party verification tools. Also, it undoubtedly offers visibility into the transaction history within the banks' operations.
It can reduce hacking, DDOS attacks, and other scams. Blockchain helps banks to identify their user's IDs and confirm their detail with digital Blockchain ID. It automatically reduces future frauds, which is the biggest concern of the banking system.
How bank can use Blockchain:
With Blockchain in banking, financial institutions would not need to depend on the network of custodial services and regulatory bodies like SWIFT. They can easily settle transactions directly on a public Blockchain. Here are few benefits of using the new-age technology.
Verifying Digital Identity:
Banks can't process online transactions without the verification of a person. This process can be done via face-to-face verification, logging in with passwords, or sending OTP on registered mobile numbers.
Although, after the application of Blockchain technology, this process becomes more seamless and more secure due to its accurate data reading capability.
It might be possible to automate the process of transaction, which costs time, added complexity, and delays the transactions using smart contracts. It is a contract with terms and agreements between the buyers and sellers' business. This computerized contract permits the trustworthy transaction completely free from any central authority or external enforcement mechanism. The new way to do business is here.
Loan processing takes too much of the user’s valuable time. It can be reduced with Blockchain. This use of the technology is called Blockchain lending. Blockchain lending can give direct benefit to customers by reducing the growing costs. It provides lenders with a competitive offer and helps them do the transaction faster and without any security defect. Blockchain-based Smart Contracts ensure that loan seeker and lender agree viable and fair terms regarding proof of funds and payment planning for future installments.
Blockchain technology has lots of advantages and revolutionary benefits to finance and banking institutions. Though, still, people are generally unaware of this technology and fear of adapting to it. This might cost us time to unify our currency and have a better future.
Frequently Asked Questions:
How is Blockchain used in finance?
Blockchain technology can improve finance and lending services by lowering counterparty risk and shortening issuance and settlement periods. It enables: authenticated paperwork and KYC/AML data, reducing risk exposures and facilitating real-time financial document verification.
What is an example of Blockchain?
Bitcoin is a well-known example of Blockchain in operation. This is a type of digital money (commonly called a cryptocurrency). This electronic form of funds may be transmitted safely from user to user without the need for intermediaries. In other words, there is no requirement for a central bank or administration. Bitcoin isn't the only currency that uses Blockchain technology.
Where can Blockchain be used?
Blockchain uses extend well beyond cryptocurrencies such as Bitcoin. With its capacity to increase openness and fairness while also reducing businesses' time & expense, the technology influences a wide range of areas, from contract enforcement to making government run more effectively.
What software is used for Blockchain?
There is multiple software available in the market for Blockchain technology; some of them are:
Solidity is one of the most widely utilized programming languages among Blockchain developers. Geth is a Go-based Ethereum node implementation. Mist is the authorized Ethereum wallet created by Ethereum's makers.
Is Blockchain the future?
Blockchain technology has several uses in a variety of sectors. Blockchain is already being utilized to help with identity management, smart contracts, supply chain analysis, and many other things. The full potential of Blockchain technology is unlikely to be realized. Till then, it is safe to assume that Blockchain is the future of the Fintech industry.
"name": "How is Blockchain used in finance?",
"text": "Blockchain technology can improve finance and lending services by lowering counterparty risk and shortening issuance and settlement periods. It enables: authenticated paperwork and KYC/AML data, reducing risk exposures and facilitating real-time financial document verification."
"name": "What is an example of Blockchain?",
"text": "Bitcoin is a well-known example of Blockchain in operation. This is a type of digital money (commonly called a cryptocurrency). This electronic form of funds may be transmitted safely from user to user without the need for intermediaries. In other words, there is no requirement for a central bank or administration. Bitcoin isn't the only currency that uses Blockchain technology."
"name": "Where can Blockchain be used?",
"text": "Blockchain uses extend well beyond cryptocurrencies such as Bitcoin. With its capacity to increase openness and fairness while also reducing businesses' time & expense, the technology influences a wide range of areas, from contract enforcement to making government run more effectively."
"name": "What software is used for Blockchain?",
"text": "There is multiple software available in the market for Blockchain technology; some of them are:
Solidity is one of the most widely utilized programming languages among Blockchain developers. Geth is a Go-based Ethereum node implementation. Mist is the authorized Ethereum wallet created by Ethereum's makers."
"name": "Is Blockchain the future?",
"text": "Blockchain technology has several uses in a variety of sectors. Blockchain is already being utilized to help with identity management, smart contracts, supply chain analysis, and many other things. The full potential of Blockchain technology is unlikely to be realized. Till then, it is safe to assume that Blockchain is the future of the Fintech industry."