Lacks of internal skills, technology, and data accessibility have been identified as part of the challenges to the adoption of predictive analytics in the financial sector.
Other challenges include data reliability, company not big enough and huge expenditure of time.
Femi Osinubi, partner/ leader , Data and AI at PwC West Africa, gave this outline while making presentation on ‘Predictive Analytics in Financial Sector’, at a Breakfast Session organized by The Chartered Institute of Bankers of Nigeria Centre for Financial Studies (CIBNCFS).
Predictive analytics allows financial institutions to understand consumer needs and to provide personalized and contextual experiences along the entire customer journey.
Osinubi said predictive analytics can provide timely feedback to executives on their strategic initiatives, adding that without feedback corrections and strategic decision making may be delayed or not noticed at all.
Predictive analytics provide leading indicators and insight to assist in planning for answering the big question, the big question: What should we do next? – next quarter, year.
In his welcome remarks, Uche Olowu, president/chairman of council, said “banking sector in financial system today is witnessing a lot of paradigm shift in how we do business and how we plan for the future. The Fintech in Nigeria today has really made a lot of impact.
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“The future of banking, business, our economy, worldwide technology has disrupted positively a lot of ways and manners which we do business. Data is key. We have a lot of data in our hands.
“The fourth industry revolution is here. That fourth industrial revolution is digital revolution. If Nigeria misses digital revolution now, can we ever recover from it? We missed the first industrial revolution, the second revolution, the third, now we are in the fourth revolution.
“Can we still believe that we should be doing it the old way? We have a lot of data in our hands, what are we doing with the data? How are we analyzing it to predict the future? How are we really prescribing to the economy, that this is where we should be? So, we feel, this is what we should be talking about.
“How will you use data to predict the behavior? Today, the first 20 big banks in the world are paying close to $250bn for cost to conduct (a penalty for not doing what is right or parts of litigation). So, if the institute has to get ready for the future of tomorrow”, Olowu said.
According to Ade Bajomo, executive director, information, technology and operations, Access Bank plc, predictive analytics can help banks track the past usage patterns and the daily coordination between the in and out payments at their branches and ATM’s, hence predicting the future needs of their potential customers.
