How Big Data Personalization Influences the Banking Industry

It is a common belief today that banks and big banking corporations basically control the world. They deliver the funds to the right place, handle big transactions, choose who they want to support, and most of, all decide what the future holds for the world.

But, a person could find themselves wondering about other aspects of the banking industry, such as the data they gather, possible security risks, as well as personalized approach to every one of their clients. When taking into consideration how big data research affects the personalization process, things get a little more complicated.

Why is big data needed by the banks?

The way we see banks is as large corporations that do their job behind closed doors, inaccessible to people who aren’t bank employees, unless in some rare cases.

What is accessible to us though is the money transaction process which is restricted to our personal use. This is the part we do and should know well as it is our money that is in question. Yet, our knowledge of banks is limited, while they know a lot more about us, and make use of that information.

Simply by using your social security number and bank account, a bank can learn everything about you, from basic data, such as your age, address and phone number, to more complex data, like your habits and interests.

They use this information to get to know you better, in order to be able to offer you something you require, or to provide the opportunities you’re seeking for.

How do banks protect this data?

Being aware of the fact that banks collect big data leads to the following question: what do they do with this data after they acquire it? Do they keep it for themselves, or sell it to companies that have an interest in it?

The thing is, you can’t possibly know what happens with your personal data after your bank gets a hold of it.

This is the reason behind banks elaborate protection systems “ or at least we hope so. Knowing there is a part of your life in the form of a chunk of data stored somewhere out there certainly makes you feel vulnerable, and there is no reason it shouldn’t.

There is no doubt that your data is important to professional hackers and that they can make a profit if they get their hands on it. This is a security risk for everyone, and the entire system can fall apart.

This brings us to the conclusion that banks need to invest more into their security systems and IT consulting. Most banks don’t take security threats lightly, but there are some that still believe nothing bad can happen.

The fact is that technology is constantly advancing and with it, the threats are becoming increasingly more dangerous. This is why it is necessary for security programs to always be adaptable to the technological advances and prepared to fight the ever-rising waves of threats.

What does the future hold for big data?

Taking all of this into consideration, we are bound to ask the question “ what will banks do with big data in the future? Is there another way for a bank to gather the essential information about its clients? What about new distribution methods?

Are you right to think that your bank is spying on you for its personal benefit? Or is this really just a way to form a personal relationship with you and build mutual trust?

More and more banks are getting interested in technologies that are on the rise, and have the ability to predict your preferences when it comes to your expenses, as well as to have a clear view of your decision-making patterns simply based on your social media profiles.

These kinds of analytics enable them to get a hold of a lot of information you might have wanted to keep private. Furthermore, they drive you to use their mobile apps and connect to your account directly via your smartphone.

This makes it a lot easier for them to collect the data they want and predict what your next move will be, even before you make it yourself, so that they can offer you what they know is necessary to you.

Final words

Knowing all this is bound to get you worried, but the fact is, there is nothing you can do about it. In today’s day and age, your bank will get to know you better by using big data it can gather about you, and there’s no fighting back. That leaves you with no choice, but to get along with it.