Practical uses for business intelligence by financial institutions abound; examples aren’t that hard to find. This article offers several insights into how financial institutions, like microfinance organisations, can use business intelligence (BI) tools in service of low-income populations.
As a small finance organisation with a modest budget, it might seem that complex data analysis services are out of reach. This is true only if you look at big, enterprise-level, BI software. In fact, there are inexpensive Web services and desktop software that can be useful. All it takes is a bit of research into business intelligence dashboards to turn up reviews and software from companies like SiSense and iDashboard.
Any financial institution or non-profit needs to track data on the population it serves, on customers or clients, and on trends in both groups that can affect the organization. This is what business intelligence is for.
A financial institution can use BI services or a BI dashboard in a number of ways:
- Evaluating customer behaviour – Slow or late on loan payments, increased deposit amounts or frequencies. BI software makes it easy to access and analyse payment histories and other account activity.
- Assessing the success of marketing efforts – If you ask customers where they found you, a BI dashboard with access to marketing data will tell you how well your marketing works.
- Refining models of credit risk – Credit history, income, and similar factors can have different impacts on the risk customers will default or fall behind. BI software can help you mine data on your customers to see if you need to change how loan risks are evaluated.
- Identifying new types of customers – A BI dashboard could help you find customers who have children aged 18-22 who might want to open their first checking account.
All financial institutions need to manage risk, reach new customers, and market themselves in a cost-effect way. Business intelligence tools allow the financial institution to mine data on customers’ borrowing habits , incomes, age, education level and other characteristics that affect the sorts of banking services customers use.
All financial institutions have access to vast amounts of data on customers, potential customers, and their communities. Affordable business intelligence tools can make it easier for those institutions to make smart decisions about how to better serve their communities.