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What is Financial Data Intelligence? How it Works, Key Definitions, and Benefits

January 22, 2024|0 min read
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In this post, we will cover:

What is Financial Data Intelligence? 

Vast amounts of consumer financial data are generated daily by each and every consumer. One transaction alone can mean dozens of data points. As a result, banks, credit unions, fintechs, and other financial providers are sitting on mountains of financial data. 

However, the majority of financial institutions and fintechs don’t have a good way to unlock the value of this data to drive better business and consumer outcomes. But, data is just data. You need to create an actionable step for your customers.

That’s where financial data intelligence comes into the picture. Financial data intelligence is the ability to make financial data actionable to increase engagement and loyalty, improve results, and drive growth. 

Financial Data Intelligence vs. Data Analytics, and Other Terms

Financial data intelligence is a term specific to how organizations leverage consumer financial data. It is a subset of a broader term — data intelligence, which is used across many industries such as retail, healthcare, manufacturing, etc., when talking about deriving actionable insights from data. Data intelligence is the tools and methods that organizations use to better understand the data they collect, store, and utilize to improve their products and/or services. 

Other organizations may refer to similar terms including data analytics and business intelligence when referring to how they analyze data. However, we think data analytics misses a key component that is present with data intelligence: making it actionable. Analysis without action is simply interesting information. To create true data intelligence, the data and insights must be actionable. 

Analysis without action is simply interesting information. To create true data intelligence, the data and insights must be actionable. 

Another similar term that is worth mentioning is “financial intelligence.” What is financial intelligence? It’s defined as gathering information about the “financial affairs of entities of interest, to understand their nature and capabilities, and predict their intentions.” It’s often used in conjunction with an investigation of a specific entity by law enforcement or related agencies. In fact, the United States government has an under secretary position within the Department of the Treasury dedicated to terrorism and financial intelligence. 

How Financial Data Intelligence Works

It starts with being able to effectively connect to, understand, and act on consumer financial data. 

Connecting the Dots

Today’s average consumer has 3 to 5 financial accounts with various banks, credit unions, and other financial providers. It’s messy for consumers to manage and makes it increasingly difficult for financial providers to get a full picture of consumers’ financial lives. 

This disjointed money experience creates blindspots for organizations when it comes to delivering the right products and services to meet consumer needs, targeting consumers with the right messages, and accurately predicting and preventing churn. 

By enabling consumers to easily connect and view all of their finances in one place with financial account aggregation, it not only helps consumers better manage their money but gives financial providers more visibility into consumer financial data. 

Understanding the Data

As we stated earlier, data is just data. It requires context, cleansing, and categorization to ensure both consumers and organizations can leverage data to its fullest extent. 

With cleansing and categorization, raw data becomes clear transaction information. And, with added context, transaction data becomes more insightful and actionable for consumers. Enhanced data also makes it easier to unlock the value of financial data and enable better decisions, improve efficiency, and uncover new opportunities.

Creating Actionable Insights and Personalized Experiences

The last piece of the puzzle is how you leverage the data to create personalized experiences, deliver proactive insights, and drive engagement and growth. 

Financial data intelligence combines connected and enhanced data with the power of artificial intelligence, machine learning, and advanced analytics. It helps financial service providers to increase engagement with consumers by delivering insights and recommended actions to help them on their financial journey and surface new insights and areas of opportunity to drive growth.  

The Benefits of Financial Data Intelligence 

Simply put: with actionable financial data intelligence, financial providers can increase engagement and loyalty, acquire more customers, and identify growth opportunities. And, financial providers can help their customers better understand and manage their finances. 

Here’s a look at our top 10 benefits of financial data intelligence: 

  1. Acquire and retain more customers with reliable connectivity solutions, enhanced data, and personalized digital experiences.
  2. Increase consumer engagement and adoption by delivering personalized financial insights and recommended actions.
  3. Surface areas of opportunity to increase deposits, expand account openings, and engage with your customers.
  4. Improve financial health by enabling consumers to better understand and manage their finances with Personal Financial Management (PFM) tools.
  5. Deliver the right message, to the right person, at the right time to improve ROI and marketing campaign effectiveness.
  6. Predict and prevent churn with a better understanding of trends and behaviors
  7. Increase customer satisfaction and loyalty with personalized experiences that meet consumers where they are.
  8. Optimize business processes by breaking down data silos and making it easier to unlock the value of financial data.
  9. Reduce call center volume and customer frustration by making data easily understandable and actionable.
  10. Accelerate innovation and product enhancements based on actionable data about product adoption, usage, and behaviors.
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