The financial industry and finance roles continue to evolve at a rapid pace thanks to speedy technological advancements. From leveraging on machine learning to addressing Cyber Security threats, here are three big trends to watch out for in 2017:
Big Data and Data Analytics
According to an article on Digital Finance and Banking Trends for 2017 in Asia published by the Fintech News SG, “data will be the foundation for many of the trends and predictions in 2017.” The finance industry is still in the early stages of big data adoption. Meanwhile, banks, asset management and insurance firms continue to be the biggest data users in the world. This disconnect happens between the collection of data and its actual use in order to provide better experience for consumers. It is now a race among financial institutions in order to use the consumer data they collected and turn it into personalized financial services and solutions for their consumers.
According to MX’s Don MacDonald, “2017 will herald in the 5th age of banking – the analytics age. Financial Institutions will face an unprecedented opportunity to be true advocates for consumers by utilizing data to the same level as other disrupted industries (think Amazon or Netflix). Consumers enjoy unprecedented choice and virtually no friction to change. FI’s who do not embrace data will find themselves beautifully equipped for a world that no longer exists.”
Addressing Cyber Security Threats
In 2017, Cyber Security will remain a concern for all industries and organizations. In 2016, we witnessed several data breaches including the theft of: 2.2 million patient records from 21st Century Oncology, 1.5 million Verizon customer records, and 150 million accounts from Yahoo! Hotmail and Gmail.
While cyber security is of great importance to virtually every business, the finance industry is in a position of handling some of the most sensitive customer data. If unaddressed, cyber attacks would only grow more in frequency and in greater damage. Threats from hackers have increasingly become of significant concern. In a Grant Thornton survey taken from 912 CFOs, they found that 44% of finance leaders felt that the most significant concern for their institution is cyber security while 57% were worried the most about undetected breaches.
According an article about Cybersecurity Trends from the Telegraph, some of the big cyber security trends of 2017 include first, the “blending of human security expertise with companies that promise purely technology-based solutions.” According to Sean Sullivan of F-Secure, “Instead of a software-only approach, the solution is to provide software and people.”
Another cyber security trend identified in the article is the use of analytics to identify suspicious behavior. Says FireEye’s chief technology officer, Josh Goldfarb, “Traditional detection methods tend to focus on identifying malware (malicious software), but attackers frequently breach organizations without using any. This could be as simple as sending a spear phishing email to an employee – a seemingly legitimate email that tricks users into handing over sensitive information, such as company login details. Attackers can use this information to break into the network. Organizations relying on traditional detection methods will miss this.”
Leveraging on AI and Machine Learning
As organizations start leveraging on the data they have collected, making sense of this will be their next central challenge. Organizations will then turn to machine learning and artificial intelligence in order to answer this challenge. According to a report by the World Economic Forum which surveyed 800 executives, 75% believed that 30% of corporate audits would be performed by AI by 2025.
According to Bradley Leimer, Head of Fintech Strategy at Santander US, “Machine learning and artificial intelligence are transforming other industries. The banking industry is just getting started building out greater efficiencies using these tools and leveraging the data we’ve neglected for decades. Banking apps will deliver personalized financial advice by leveraging aggregated financial data across a consumer’s provider in the future. Forget robo-advisors for investments only; our entire financial life will have a robo-component, and we will be better off for it.”
Financial firms who want to take advantage of the three big trends need to create a strategy tailored to their specific organization. They must look at which trends are opportunities worth exploring and review which aspects of their business can be supplemented or supported by trends such as AI or data analytics in order to gain or maintain their competitive advantage.
One of the most critical strategies is to partner with the right vendor. Partnering with the right provider, like Infinit-O, can help you identify areas of opportunity where they can help impact your organization’s business productivity, save on costs or even increase profits.