Data ethics is an asset for banks

Aurélie Goncalves

Banking Sector Manager, Business & Decision

Regulation in general and GDPR in particular have had a strong impact on the banking sector, kick-starting extensive change. Banks are now extracting greater value from their data, providing ever-more online services, and investing in their customers’ trust. A decade after the 2008 financial crisis, traditional banks are faced with up-and-coming online banks and other neo-banks shaking up the sector. As a result, the number of branches is decreasing, competition is intensifying, banks know more about their customers and their needs, and digital services are proliferating.

Customer data is becoming a critical concern for banks. It is also raising questions – how to turn raw information into actionable intelligence, how to innovate in their heavily regulated business environment, and how to extract value from and protect their data assets. It’s not easy to strike a balance between all those moving parts. According to a French Banking Federation survey, 43% of people in France wouldn’t mind banks using their personal data to offer them targeted services. AI Big data and big data strategies are opening up new opportunities, with new answers to the questions about building a 360° vision of customers and customer relationships. Analysing customer views and feedback across channels can help to hone in on the subjects that will interest customers, sensitive issues and areas where there is a risk of attrition. This approach, in other words, picks up the weak signals that can then shape marketing strategies.

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Using data more effectively is one way of optimising business. And, to yield valuable insights, data needs to be available and traceable. Banks can also supplement their data with information from other sources (for example the Banque de France’s payment incident database to assess the likelihood of a payment default). Harnessing data, at the end of the day, will help banks offer more targeted and tailored services, limit risks and follow market trends. To do that, banks need to behave responsibly and show customers that they are using their data wisely. That is how banks will play a role advancing data ethics.