Page 36 - Banking Finance November 2021
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ARTICLE

         Banking analytics can be successfully implemented by either  winner in the 'Best Use of Data Analytics' category at
         pure-play analytic service providers such as Absolute data,  the Retail Banker International Awards 2018- organized
         CRISIL etc. who support only analytics services; and IT/BPO  by Retail Banker International, an online publication
         service providers who engage themselves both in analytics  that provides news on banking and finance from across
         as well as BPO services such as Accenture, Cognizant, IBM,  the globe.
         Genpact, hp, Infosys, TCS, WNS etc.
                                                              D. Kotak Mahindra Bank's analytics platform extracts data
                                                                 from its core banking system and the relationship
         Analytics in Indian Banking Scenario:                   management system, combines them and puts in place
         Analytics in Indian Banking is still at its nascent stage and  algorithms which are working on certain thresholds. The
         so the value creation potential is also very low. The market  bank implements various significant events like change
         size of Finance and Banking sector in Analytics is growing at  in demographics viz. marital status, city, transactional
         a faster pace than any other sector as it was USD575 million,  pattern viz. significant credit/ debit, premature
         USD756 million and USD1030 million and USD 6.32 billion in  withdrawal of term deposit, stop in any regular activity
         2020 during 2016, 2017, 2018 and 2020 respectively and is  viz. auto-pay, standing instructions/ECS, drop in
         projected to reach USD11.02 billion by 2026. Delhi and  transaction value or volume throughputs across a period
         Bangalore are showing increasing growth rate with respect  vis-à-vis historical trend and payments to beneficiaries
         to market size. Let us see trend of analytics in Indian  like securities, builders, dealers These details are shared
         Banking system through a few cases.                     with Relationship Managers of the Bank for identifying
                                                                 business opportunities. The Bank has identified that a
         Several Indian banks have already initiated data        meeting led through cues from data analytics tools is 3
                                                                 times more effective than the random meetings
         analytics initiatives. Some examples are as
                                                                 scheduled by a Relationship Manager.
         under-
         A. HDFC Bank was able to scale to large datasets and build  Conclusion:
             models using high-performance parallelized RevoScaleR
             algorithms. The Bank provided a seamless loan    Banks should transform massive volumes of organizational
                                                              data into actionable insights and strategies. Business
             application experience as well as quick turnaround on
             loan dispersals for customer Demographic, geographic,  Analytics or Big Data Analytics provides comprehensive
                                                              capabilities to help banks to perform customer profitability
             and other data are utilized to augment loan
             applications and credit analysis. Instead of data  analytics, manage risk and improve operational efficiency.
             manipulation, preparation, and governance the Bank  Sophisticated predictive and prescriptive analytics improves
             may focus on models, develop algorithms, streamline  banks' profitability,  compliance, sustainability and
             updates, and create new innovations in customer  competitiveness. However, implementing these analytics is
             services.                                        a challenging aspect looking at the basic realties such as
                                                              functional silos, talent crunch and technological resources
         B. Axis Bank automated the assignment of scores based  or infrastructure. But there is no other way out for the
             on risk and other propensities in their consumer lending  banking industry that can create value than the tool
             business. The Bank expected that the scorecard driven  Analytics.
             underwriting would result in better accuracy,
             consistency and lower credit costs. Analytics is utilized  References
             in their marketing campaigns. The Bank is also   1.  www.rbi.org.in
             concentrating on data from Internet and mobile
                                                              2.  https://cio. economictimes.indiatimes.com
             banking, social media etc. towards improved customer
             service by understanding their customers' challenges.  3.  https://www.businesstoday.in
             The Bank plans to incorporate fraud analytics as well.  4.  www. icicibank.com
                                                              5.  www.thehindubusinessline.com
         C. ICICI Bank equipped 2000 managers with design thinking
             and data analytics skills.  The Bank has been utilizing  6.  www.businesstoday.in
             data analytics for multiple activities and it was declared  7.  www.mordorintelligence.com


            36 | 2021 | NOVEMBER                                                           | BANKING FINANCE
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