BUSINESS ANALYTICS IN

THE BANKING INDUSTRY

Made by:- Sakshi Chawla

Introduction
 It is the science of analyzing raw data in order to make
conclusions about that information.
 Data analytics help a business optimize its
performance.
 It is a process of inspecting, cleansing, transforming,
and modeling data.
  In today's business world, data analysis plays a role in
making decisions more scientific and helping
businesses operate more effectively
Introduction
 Banking analytics, can help improve how banks
segment, target, acquire and retain customers.

 Also, improvements to risk management, customer

understanding, risk and fraud.

 enable banks to maintain and grow a more

profitable customer base.
Application of Data Analytics in Banks
 Application of Data Analytics in Banks

1) Risk Modeling
Risk Modeling a high priority for the banking industry.
With Data Analytics , banking industries are able to analyze
and classify defaulters before sanctioning loan in a high-risk
scenario.

2) Fraud Detection
With the advancements in machine learning, it has become
easier for companies to detect frauds and irregularities in
transactional patterns.
3) Customer Lifetime Value
with analytics, banks can classify potential customers and
assign them with significant future value in order to invest
company resources on them.

4) Customer Segmentation
 machine learning techniques like classification and
clustering play a major role in determining potential
customers as well as segmenting customers based on their
common behaviors
5) Recommendation Engines
Providing customized experiences to clients is one of
the major roles that a bank plays.
Recommendation Engines used are: User-Based
Collaborative Filtering, Item-Based Collaborative
Filtering

6) Real-Time Predictive Analytics

Predictive Analytics is the process of using
computational techniques to predict future events.
With the rapid increase in data, there is an abundance
of analyzing data is at its peak.
 Benefits
 Efficient Risk Management
 To Prevent Errors And Frauds
 Provides Personalized Banking Solutions to Customers
 Easier Filing Of Regulatory Compliances
 Boosts Overall Performance
 Effective Customer Feedback Analysis
Example
 To counter a shrinking customer base, a European
bank tried a number of retention techniques
focusing on inactive customers, but without
significant results.
 Then it turned to machine-learning algorithms that
predict which currently active customers are likely
to reduce their business with the bank.
 This new understanding gave rise to a targeted
campaign that reduced churn by 15 percent.
Conclusion
 Data Analytics in banking plays a major role.
 Banks all over the world analyze data to provide
better experiences to their customers.
 There are several key areas like Fraud Detection,
Risk Modeling, Customer Lifetime Value, Real-
Time Predictive Analytics etc.
 The use of Analytics can help banks differentiate
themselves and remain competitive in the future.
Thank You