Skip to main content

Fintech Adopts Big Data and Cognitive Computing Apps

Given that the financial services sector thrives on large quantities of data, it is not surprising that new technology is expected to play a key role in this industry's digital transformation. Innovative and disruptive financial technology (Fintech) ventures will create new business models that drive progressive change.

Juniper Research has found that Fintech platform revenues for unsecured consumer loans issued using machine learning technology are set to grow by 960 percent during 2016 to 2021, rising to $17 billion globally. This growth is being driven by advances in big data analytics and cognitive computing.

Juniper's latest market study found that machine learning investment in Fintech will advance rapidly, owing to the highly data-driven nature of the market -- it's anticipated that AI integration is likely to produce substantial benefits.

Machine learning technology advances -- a subset of artificial intelligence (AI) -- have grown significantly since 2011, with substantial increases in related venture capital (VC) and research & development (R&D) investment.


Fintech Market Development Opportunities

For example, two Fintech start-up companies -- Kabbage and ZestFinance -- have collectively raised $500 million in funding. Meanwhile, vendors analyzed by Juniper have invested a total of $83 billion in R&D during 2015. Each of these vendors names AI as a part of their core business strategy.

Until recently, machine learning was too expensive and computationally time-intensive to break into the mainstream. Moreover, access to extensive data sets for algorithm training were somewhat limited.

Presently, the ability to use GPU (graphics processing unit) hardware for processing massive and highly available data sets, along with unlimited affordable computing power in the form of distributed architecture, has opened the market to a swathe of disruptive new players.

Big Data Analytics and Cognitive Computing Apps

AI and other forms of cognitive computing are particularly useful for risk-assessment purposes, where variables from numerous financial and non-financial datapoints are assessed by algorithms to approve loans.

This widens the addressable market for financial institutions considerably over traditional FICO credit scoring, where lack of credit history may mean loan rejection despite a real low risk for the lender.

"Where Big Data analytics offered retrospective business intelligence, machine learning offers predictive and even prescriptive capabilities," said Steffen Sorrell, senior analyst at Juniper Research. "Data is key -- and industries able to draw expertise from data scientists will be the first to capitalize on the AI opportunity."

Popular posts from this blog

Wireless Solutions Advance Work from Home Trends

Despite a challenging backdrop from the ongoing effects of the global COVID-19 pandemic, the negative impact on fifth-generation (5G) wireless supply chains has been minimal compared to the wider mobile smartphone market. This led to 5G mobile devices becoming more diverse, brought to market quickly at a variety of price points, thereby accelerating affordability and adoption. The mobile market is transitioning to 5G and many leading vendors are now exploring the low-priced 5G smartphone segment. According to the latest worldwide market study by ABI Research, 681 million 5G handsets will be shipped in 2022. Therefore, the race is on for OEMs to find that all-important level of differentiation in their flagship portfolios to help boost margins and improve market share. 5G Wireless Market Development Vendors continue to drive the adoption of new product designs, screen technology, chipsets, and camera setups -- notably within the flagship smartphone segment. Meanwhile, the leaders seek a

Software-Defined Infrastructure: The Platform of Choice

As more organizations adapt to a hybrid working model for their distributed workforce, enterprise CIOs and CTOs are tasked with delivering new productivity-enabling applications, while also seeking ways to effectively reduce IT cost, complexity, and risk. Traditional IT hardware infrastructure is evolving to more software-based solutions. The worldwide software-defined infrastructure (SDI) combined software market reached $12.17 billion during 2020 -- that's an increase of 5 percent over 2019, according to the latest market study by International Data Corporation (IDC). The market grew faster than other core IT technologies. The three technology pillars within the SDI market are: software-defined compute (53 percent of market value), software-defined storage controller (36 percent), and software-defined networking (11 percent). "Software-defined infrastructure solutions have long been popular for companies looking to eliminate cost, complexity, and risk within their data cente

Digital Identity Verification Market to Reach $16.7B

As more enterprise organizations embrace the ongoing transition to digital business transformation, CIOs and CTOs are adopting new technologies that enable the secure identification of individuals within their key stakeholder communities. A "digital identity" is a unique representation of a person. It enables individuals to prove their physical identity during transactions. Moreover, a digital identity is a set of validated digital attributes and credentials for online interactions -- similar to a person's identity within the physical world. Individuals can use a 'digital ID' to be verified through an authorized digital channel. Usually issued or regulated by a national ID scheme, a digital identity serves to identify a unique person online or offline. Digital Identity Systems Market Development Complementary to more traditional forms of identification, digital identity verification systems can enhance the authenticity, security, confidentiality, and efficiency of