Blog: How cross-border data connectivity can help you achieve your ESG goals
By: Kenneth Kuek, Business Development, InterSystems
The recent announcement of a cross-border agreement to improve data connectivity in financial services is good news for Asian banks that are aiming to improve the customer experience, boost their risk management capabilities, and enhance operational efficiencies. At the same time, improved data connectivity will support the achievement of environmental, social, and governance (ESG) goals.
The new agreement between the Monetary Authority of Singapore and the Swiss State Secretariat for International Finance encompasses the cross-border transmission, storage, processing, access to, and protection of data in financial services. This provides a solid foundation for banks and fintechs to improve their data management capabilities both internally and across industry partners located within the region and overseas. It is also timely considering the rapid growth of digital banking in countries like Indonesia and Malaysia as banks and fintechs aim to democratise finance for everyone.
How you use your institution’s data is pivotal to capitalise on the foundations that are now in place. When you can harness and harmonise data effectively, it can be used to enhance the customer experience, improve business operations and performance, support innovation and growth, and strengthen risk and compliance, which includes realising ESG commitments.
While this sounds great, a new InterSystems study has found the reality is more challenging for finance firms, with 87% experiencing frustrations and concerns in using their data to drive decision-making. The biggest data challenges are:
not being able to report on all relevant data (36%)
not being able to get data from all the required sources (35%)
delayed access to data (34%).*
There are three ways financial institutions can resolve these issues and more effectively harness their data across the business, its customers, and as part of the broader ecosystem.
- Master data management
The InterSystems survey found that 54% of finance business leaders are prioritising master data management in the next 12 months.* This is because they recognise that data helps accelerate digital transformation efforts. Master data management brings together technology and business to achieve consistency, accuracy, and accountability of a firm’s controlling data.
New, cloud-based master data management technologies seamlessly harness and harmonise master data across the organisation to deliver more visibility, accuracy, and accountability. This results in better data insights to inform business decision-making.
- Eliminating data siloes
Most finance business leaders (98% in fact) say there are data and application siloes in their organisations. However, only 21% will prioritise eliminating these siloes in the next 12 months.* These are the organisations to watch in the next year because they will be much better positioned to deliver enhanced customer experiences and speed the delivery of new products and services to market. This is because data siloes significantly slow an organisation’s capability to drive confident decision-making.
Of organisations that have data siloes, 68% cannot base decisions on information less than one day old, while 33% are making decisions based on data that is up to three days old, and 16% rely on data that can be up to a week old. One in five (20%) organisations don’t feel they have a 360-degree view of customer data, and 11% lack the confidence that their organisation has a real-time understanding of enterprise-level risk.*
Based on these numbers, it’s clear that data siloes create significant issues with separate applications, fragmented information, duplicate data, and the wrong information being delivered to decision-makers.
A data fabric resolves these challenges by breaking down data siloes. It's an architectural approach that speeds up and simplifies access to data across the entire business ecosystem. It accesses, transforms, and harmonises data from multiple sources on demand, and makes it usable and actionable for a wide variety of business applications. Smart data fabrics take this approach one step further by embedding analytics capabilities—such as data exploration, business intelligence, natural language processing, and machine learning—directly into the fabric, making it faster and easier for finance organisations to gain new insights and power intelligent services and applications.
- Operational efficiencies
In Asia Pacific, 39% of finance business leaders tell us they view improving operational efficiencies as a top initiative for which they require real-time access to distributed data. Meanwhile, 79% of business leaders are considering implementing a data fabric to simplify their access to distributed data.*
Finance leaders are recognising that simplifying access to distributed data has a direct connection to improving operational efficiencies. When you can harness and streamline your data, you get faster insights, better responsiveness, and greatly improved productivity. This is where data management solutions make a tangible difference when it comes to business performance.
When adopting data transformation solutions, the good news is that, with the right platform, you can retain existing technologies and data analytics tools. Secure, cloud technology lets you democratise your data without the need to rip and replace existing systems.
The key benefits of adopting data technology for your financial services organisation are:
better operational performance due to reliable, real-time insights across the organisation
the ability to accelerate new products and services to gain a competitive edge in the market.
These capabilities can be easily realised whether you are investing in business enablement and growth on your own, or building an ecosystem with industry partners. For fintechs in particular, being able to offer deep and timely market intelligence can prove highly attractive to your industry partners.
To gain a deeper understanding of recent data management challenges and trends in the Asia Pacific financial sector, read the InterSystems report here.