Five Advanced Analytics Drivers in Your Lending Organization

October 15, 2019 by Kelly Nguyen

Over the years, businesses have gathered a plethora of datasets on their customers. However, there is no value in data alone. The true value comes from the insights gained and actions that can be derived from these datasets.

Advanced analytics is the key to understanding the data and extracting the critical information needed to unlock these insights. AI and machine learning in particular, are two emerging technologies with advanced analytics capabilities that can help companies achieve their business goals.

According to an IBM survey, 61% of company executives indicated that machine learning and AI are their company’s most significant data initiatives in 2019. These leaders recognize that advanced analytics is transforming the way companies traditionally operate. It is no longer just a want, but a must.

With a proper strategy, advanced analytics can be a competitive differentiator for your financial institution. Here are some ways that advanced analytics can empower your organization:

  1. Provide Personalized Customer Experiences
    Business leaders know that their customers want personalized, frictionless and enhanced experiences. That’s why improving the customer experience is the number one priority for 80 percent of executives globally, according to an Experian study. The data is already there – companies have insights into what products their customers like, the channels they use to communicate, and other preferences. By utilizing the capabilities of advanced analytics, companies can extract more value from this data and gain better insights to help create more meaningful, personalized and profitable lending decisions.
  2. Reduce Costs
    Advanced analytics allows companies to deploy new models and strategies more efficiently – reducing expenses associated with managing models for multiple lending products and bureaus. For example, OneMain Financial, was able to successfully drive down risk modeling expenses after implementing a solution with advanced analytics capabilities.
  3. Improve Accuracy and Speed to Market
    To stay ahead of the competition, companies need to maintain fast-moving environments. The speed, accuracy and power of a company’s predictive models and forecasts are crucial for success. Being able to respond to changing market conditions with insights derived from advanced analytics is a key differentiator for future-forward companies. Advanced analytic capabilities empower companies to anticipate new trends and drive rapid development and deployment, creating an agile environment of continual improvement.
  4. Drive Growth and Expand Your Customer Base
    With the rise of AI, machine learning and big data, the opportunities to expand the credit universe is greater than ever. Advanced analytic capabilities allow companies to scale datasets and get a bird’s eye view into a consumer’s true financial position – regardless of whether they have a credit history. The insights derived from advanced analytics opens doors for thin file or credit invisible customers to be seen – effectively allowing lenders to expand their customer base.
  5. Meet Compliance Requirements
    Staying on top of model risk and governance should always remain top of mind for any institution. Analytical processing aggregates and pulls new information from a wide range of data sources, allowing your institution to make more accurate and faster decisions. This enables lenders to lend more fairly, manage models that stand up to regulatory scrutiny, and keep up with changes in reporting practices and regulations.

Better, faster and smarter decisions. It all starts with advanced analytics. Businesses must take advantage of the opportunities that come with implementing advanced analytics, or risk losing their customers to more future-forward organizations.

At Experian, we believe that using big data can help power opportunities for your company. Learn how we can help you leverage your data faster and more effectively.

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