An analysis of the study: “2022 business and consumer insight report“, by Experian.
Due to the rise of open banking, we are witnessing how more and more research is carried out to discover the possibilities of this technology for companies and consumers.
Recently, Experian analyzed the opinions of companies and consumers on different topics, such as privacy and data sharing, user experience, technology investment, bank data analysis and much more. In this article we summarize the main conclusions so that you can better understand everything that open banking can offer you.
Consumer financial health, data attitudes and the impact on Open Banking
Malin Holmberg, CEO EMEA and APAC of the company, welcomes mentioning how the pace of digital transformation continues to grow: “More and more companies are investing in technology in a bid to improve performance, deliver greater operational efficiency and enhance the user experience.”
A total of 587 financial services and telecommunications executives and more than 3,000 consumers were surveyed in six markets: Denmark, Germany, Italy, the Netherlands, South Africa and Spain. The findings reveal a common set of challenges and perspectives across geographies.
43% of consumers are living on the go, looking for new solutions to manage their spending easily, and as many as 74% have used a BNPL service in the past 12 months.
The main reason for using a BNPL service is greater flexibility in payments, convenience of use, and help with household spending planning. As consumers look to borrow more, they seem to choose the convenience of BNPL services, either replacing the other traditional loan options.
The real opportunity for Open Banking lies in the “value exchange” and the extent to which consumers see the benefits of shared data in the form of better services or better experiences with their banks.
of consumers would agree to share
their financial information through a banking App.
Value exchange is key: 21% would refuse, but would be willing to change their mind in exchange for:
- Enjoying a faster App.
- Get personalized advantageous offers.
- Avoid sending physical paperwork
Most companies have invested or plan to invest in Open Banking
39% of companies have invested in Open Banking, and another 47% plan to do so. The appeal of Open Banking is clear for financial services and telecommunications companies, including the promise of an enhanced and personalized customer experience, as well as increased accuracy of creditworthiness assessments for lending or financing decisions.
How do you prioritize the following Open Banking use cases in your organization?
*Sample: 587 financial services and telecommunications executives (EMEA).
This demonstrates the power of transactional data. It is worth noting that the research considers the value of open banking holistically, with a wide range of use cases. Given that transactional data can provide insights into revenue estimation, financial vulnerability or identity verification, it is clear why most companies that have not yet invested in open banking plan to do so in the short to medium term.
Advanced analytics and the rise of machine learning
The research highlights the difficulties in bridging the experience gap, coupled with increased technological complexity in the market. As a result, entities are seeing the need to ally with FinTech, with much more flexible structures and significantly lower costs, to bring that differential value.
of companies believe that artificial intelligence and machine learning are already radically changing the way they do business.
41% also say that more advanced analytical models are needed to better understand customers and respond to their needs. It is clear that many companies see machine learning and artificial intelligence as the answer to these problems.
Businesses and consumers include fraud prevention as one of their priorities, according to the research. The main challenge is that constantly updated solutions are required to stay protected from emerging threats. Scale up technology innovation can find the balance between a satisfactory customer experience and a total guarantee in the protection of their data.
Use machine learning to categorize and deliver insights to your customers
In the case of Coinscrap Finance, in addition to strict compliance with all national and international regulations, in order to ensure the protection of sensitive information, we have a certification for our Information Security Management System according to ISO 27001 by EQA. Among our technological developments, we should also mention those capable of analyzing and contrasting information posted on social networks with different official sources (such as the BOE) to detect possible fraud. These innovative tools also use artificial intelligence, but are complemented with NPL (natural language processing) to improve their continuous learning.
In the same way, machine learning and deep learning techniques are able to detect fraud in real time. Using flexible models, they analyze the user’s digital habits and map out “predicted” behavior. If they detect any deviation from that behavior, they can automatically flag it for a second analysis. In this way, movements that escape traditional security systems are checked.