Unlocking the potential of real-time data analysis
By Mariana Almeida Marques and Carl Strempel
1- Open banking as a catalyst for enhanced data collection
Every time a customer makes a payment, their data is collected and retained by banks and all payment companies involved in the transaction. The European PSD2 directive has made open banking a new norm, enabling third-parties to gain access to customer information and other financial data through the use of APIs (Application Programming Interfaces).
The concept of open banking is becoming increasingly significant in how companies handle data, as it facilitates data collection and analysis for all players- not just the FinTech start-ups whom banks partner with. There are overwhelmingly large amounts of data to be collected and analysed, which makes this a complex process that requires a lot of human and technological resources. Analysing data in-house entails heavy financial investment into appropriate tooling and data warehousing and can require substantial transformations to traditional IT infrastructures.
A much simpler and effective solution is to partner with third-party providers that offer data monitoring and reporting services. They often use the latest technologies to spot trends, including AI and machine learning to enhance data sets and automate analysis.
2- The benefits of data analysis
Payments data analysis is used to define consumer micro and macro trends in terms of customer spending behaviour, which gives companies the power to more effectively measure their business performance, as well as to know their customers better and understand their habits and preferences.
Insight into customer behaviour is an enormous competitive advantage, as it allows companies to detect opportunities for growth, improve customer service and potentially even to expand their product range and open up new revenue streams. The financial services and payments industry are becoming increasingly customer-focused, and data analytics is critical for a customer-based strategy. At a time when there are new technologies and new players striving to disrupt the market, companies understand that their success depends on customer reach, satisfaction and retention.
Data visibility and analysis also plays a big role in compliance with regulations such as AML and KYC. Machine-learning software can read through large amounts of transaction data to detect irregularities, determine fraudulent patterns and effectively predict fraudulent behaviour. A considerable part of combating fraud and any other cybercrime comes from preventing these crimes.
3- The obstacles of analysing real-time data
Real-time payments requires treasurers to review their operating models and rethink their rules for investment and liquidity plans. Above all, it is a new way of managing finances that presents great company-wide advantages. However, when it comes to real-time payment analysis, companies are still struggling to fully reap the benefits that accurate instant data promises.
These challenges are multi-faceted, often rooted in legacy applications with complexity multiplied across an ever-expanding international footprint. Large corporations, by their nature, maintain multiple business partnerships with payment service providers, banks and other non-traditional third-parties such as voucher and alternative lending companies.
Each of these third-parties provides them with detailed data reports and monitoring tools, so finding the data isn’t the biggest challenge anymore. However, payment data is only valuable if the information can be gathered quickly (within set timeframes), normalised and ingested into the company’s enterprise resource planning (ERP) systems and analytics tools in order to shape value-added strategies and enhance reconciliation efforts.
Data reporting is still very often seen as a finance function tied inextricably to the financial close cycles. The challenge arises when treasurers have to gather all the datasets that come from different providers, analyse them thoroughly, extract the right insights and deliver them to the business. Because third-parties deliver data reports in different ways and different timings, it is a burdensome and time-consuming task to gather all the data and translate it into meaningful insights. It is equally difficult to make this process fit into the company’s timeframe without significant technological investment.
Ideally, treasurers and controllers would be able to compile all the data, analyse it and deliver their findings to the wider organisation in a timely manner. Only then can companies fully optimise internal and external business operations, enhance their customer service and develop efficient growth strategies.
4- How Imburse can help
Imburse offers connectivity to the entire payment ecosystem. Through Imburse, your company can quickly and easily connect with any payment provider and deploy any payment technology available in the market. Our solution addresses the problem of single-integrations and enables companies to access all the payment services they need to provide the best customer service, enhance internal operations and scale their business without any constraint. Imburse supports real-time payments, as well as other payment schemes across the globe. We give you full flexibility so you can adapt to industry changes, deploy the latest technologies and always be at the forefront of innovation.
Aside from being able to connect to all payment players, companies can access a wide range of additional payment functionalities, including auto-reconciliation, smart routing, mandate management and data analytics.
The 360-degree data analytics capability allows you to access all your company’s data in real time, whenever suits you best, which will contribute for more accurate reporting. It will also help to streamline accounting processes, save treasurers time and improve their internal organisation. A 360-degree view of customer and vendor data benefits not only your finance team, but your company as a whole.
Imburse’s mission is to enable companies to fully enhance their payments system. That is why our end-to-end solution provides you with everything you need to exceed customer expectations and succeed in a highly competitive and increasingly tech-driven industry. Reach out to our team or visit our website should you like more information on how Imburse can help your business.