Creativity and Innovation in Entrepreneurship

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Image  —  Posted: February 26, 2023 by Virendra Yaduvanshi in Database Administrator
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Business Intelligence – Architecture

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Image  —  Posted: February 6, 2023 by Virendra Yaduvanshi in Database Administrator
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Data Analytics vs Business Intelligence

Posted: January 6, 2023 by Virendra Yaduvanshi in Database Administrator
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Nowadays, Big data adoption is increasing rapidly across all sizes of organizations, however, the method and distinction between obtaining Business Intelligence (BI) and employing Data Analytics (DA) to make actual business decisions with an impact are getting lost in translation. While both terms are used interchangeably, BI and DA are essentially distinct in many ways.
As per some people, there is a distinction between the two by claiming that, while DA employs data science approaches to predict what will or should occur in the future, while BI looks backwards at historical data to describe things that have transpired.
There are differences between DA vs BI, although business intelligence is the more inclusive term that includes analytics. BI assists individuals in making decisions based on historical data, whereas data analytics is more focused on future predictions and trends.
Data analytics is the process of examining databases to find trends and insights that are then applied to decision-making within organizations. Business analytics is concerned with examining various forms of data in order to create useful, data-driven business choices and then putting those conclusions into practice. Insights from data analysis are frequently used in business analytics to pinpoint issues and come up with remedies.  Most businesses make the mistake of trying to implement new technology too quickly throughout their entire business without a strategy in place for how they will really use the tools to address a specific problem.
The process of gathering and studying unprocessed data to make inferences about it is known as data analytics. Every organization gathers enormous amounts of data, whether it is transactional data, market research including ethnographic research, or sales data. The true value of data analysis resides in its capacity to spot trends, hazards, or opportunities in a dataset by identifying patterns in the data. Businesses can change their procedures based on these insights and use data analytics to make better decisions.
BI is the process of iteratively examining an organization’s data with an emphasis on using statistical analysis tools to uncover the knowledge that can support innovation and financial performance. Business analytics enables analytics-driven firms to get the most value from this wealth of insights. They can treat big data as a valuable corporate asset that powers business planning and underpins long-term goals. Business analytics can be classified as either descriptive, predictive, or prescriptive. These are typically deployed in phases and, when combined, can address or resolve almost any issue that a business may have.

Techniques Used In DA

To expedite the analytical process, the majority of widely used data analysis procedures have been automated. Data analysts may now quickly and efficiently sort through massive volumes of data using the following methods rather than spending days or weeks doing so. They are described as follows:

  • Data mining is the process of searching through big data sets to find patterns, trends, and connections.
  • In order to assist firms to respond effectively to future outcomes like customer performance, predictive analytics aggregates and analyses previous data.
  • Machine learning teaches computers to process data more quickly than traditional analytical modelling by using statistical probability.
  • Utilizes machine learning, predictive analytics, and data mining techniques to turn raw data into actionable business knowledge.
  • Documents, emails, and other text-based content can be mined for patterns and moods using text mining.

Techniques Used In BI

BI techniques can be classified as either descriptive, predictive, or prescriptive. These are typically deployed in phases and, when combined, can address, or resolve almost any issue that a business may have. They are described as follows:

  • Descriptive analytics parses historical data to gain knowledge on how to make future plans. Executives and non-technical professionals can benefit from the insights produced by big data to improve business performance because self-service data access, discovery, and dashboard technologies are widely available.
  • Predictive analytics is the subsequent stage on the road to insight to assist organizations in forecasting the possibility of future events, machine learning and statistical techniques are used. Predictive analytics can only indicate the most likely conclusion based on the past because it is probabilistic in nature and cannot foretell the future.
  • Prescriptive analytics investigates potential courses of action based on the findings of descriptive and predictive analysis. This kind of analytics mixes business rules with mathematical models to offer many viable answers to various tradeoffs and scenarios to improve decision-making.

Culture of Innovation in Engineering

Posted: January 5, 2023 by Virendra Yaduvanshi in Database Administrator
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In every oraganisation team members need to feel comfortable sharing their ideas, management needs to ensure that they feel safe and empowered.  It’s imperative to structure the culture of innovation by establishing a group that evaluates ideas, a process for submitting ideas and an incentive to submit ideas. Many organizations establish an Architectural Board, made up of leaders from different areas of the technology organisation, that provide areas to ideate in and evaluate ideas submitted by team members. The board is responsible for giving feedback to everyone that submits an idea so they understand its value to the organization and the reasons it will or will not be implemented. Constructive feedback should always be given privately while great ideas should be praised publicly.

Identifying Problem

Poor definition or direction is often the root cause of poor ideation, so make sure that the team must know about problems. we can identify problems by taking monthly/quarterly surveys with questions like:

  • What are the biggest challenges facing you or your team?
  • What keeps you up at night?
  • What is one thing you’d do differently and why?

The answers will help to identify areas for exploration. It is important to present to the teams the problem and ask them to develop the solutions.

Create Space for Innovation

Contrary to the popular idiom that necessity is the mother of invention, innovation is often stifled by necessity. Engineers are going to allocate all their time to executing the tasks they need to complete unless management creates time for them to spend exploring, ideating, and innovating. Sending people to conferences and requiring them to give presentations about what they learned and how it can be applied to the current business challenges is one way to give people time and space. Another is to simply carve out 10-15% of an engineer’s time each month to ideating on a topic or subject. we can allow them to pick their own areas or start by assigning areas for exploration.

Show Gratitude

Show people their ideas are appreciated through recognition, compensation, and action. Publicize good ideas and the people that generated them to the entire company along with recognition from leadership. This provides social esteem for individuals while providing a model for others to follow. Establish bounties for solving critical issues. A little extra money goes a long way to motivating people. Hold internal hackathons quarterly to foster healthy competition. Ask yourself what would motivate you to participate and then ask your team leaders what they think will motivate their staff.

Get Started

A simple method to kicking off this culture of innovation is by identifying a champion and working with them to develop the first idea. Then make it all their idea and start the process of demonstrating gratitude publicly and implementing the idea immediately.

Data-driven Culture

Posted: January 4, 2023 by Virendra Yaduvanshi in Database Administrator
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Data Culture is a passport you need to survive in this new digital world, where decisions are driven by data rather than solely on assumptions and past experiences.
Data culture is a journey, where we need to constantly keep working on it, and it will keep on improving. Data is all around us. It is in the form of numbers, spreadsheets, databases, pictures, videos, and many other things. Organisations are now using data and leveraging it to derive impact and growth. Data is the backbone, and a data-driven culture is critical for organisations to survive and expand.  A data-driven culture is about replacing the gut feeling to make decisions with facts and assumptions. A company is said to have a data-driven culture when people are clear about the driver metrics they are responsible for and how those metrics move the Key Performance Indicators – KPIs. There needs to be data democratization, i.e., the information is accessible to the average user. The company needs its employees to understand and use data to make decisions based on their roles. It needs citizen analysts, who can do simpler analytics, and are not dependent on the data team for it. The company also needs a Single Source of Truth—when the employees/stakeholders make decisions based on the same data set. It needs to have data governance and Master Data Management in place to maintain uniformity, accuracy, usability, and security of data.

At the very top level, there are four components of data-driven culture—Data Maturity, Data-Driven Leadership, Data Literacy, and Decision-making Process. These 4Ds are essential when building a data-driven culture.

Data Maturity

Data maturity is foundational to data culture. It deals with the raw material, i.e. data, and its management. An organization with good data maturity has high standard data of quality and checks in place to maintain it. For a good level of data maturity, it is important to have metadata management in place and ensure that it is aligned with the KPIs. Similarly, it is necessary to record Data Lineage, which helps in understanding what happened to it since its origin. Other factors that affect data maturity are usability, ease of access, and scalable and agile infrastructure. For example, if a company has an archaic infrastructure in place, it will take too long to access data. In such scenarios, the organization will not use data that is not easily accessible. Further, companies would spend most of their time validating and building alignment rather than on the impact if there is no alignment of the KPIs.

Data-Driven Leadership

Leaders define the culture of any organization. To establish a data culture, leaders must step up and lead by example. A data driven leader asks the right questions and holds his/her teams responsible to ensure that data is being used and a structured process is followed. A data-driven leader sees data as a strategic asset and makes “think and act data” a key strategic priority.

Data Literacy

Companies with a higher data literacy tend to use data to understand their customers better as well as how they use the product. Data literacy is the ability to read, use, digest, and interpret data toward meaningful discussion and conclusion. For an organization, data literacy does not mean that employees have an excellent understanding of using and interpreting data. It calls for everyone to have a certain level of data literacy depending upon their job role and the decisions they need to make. However, it also calls for ensuring that there is no data sceptic.

Decision-making Process

Data needs to be an integral part of that decision-making process to get the most value out of it. Is there a planning mechanism in place to choose between projects to work on or if there is a lookback mechanism to review the decisions? Most organisations do not have a systematic, data-driven decision-making process.

Using facts and evidence in the workplace is a good way to guide a company’s decisions and track outcomes. When everyone within an organisation incorporates data and information in their day-to-day activities, they develop a culture that emphasizes and prioritizes data analysis. Cultivating a data-driven culture in our workplace can improve outcomes across the organization and ensures a strategic plan for achieving goals.

Data Migration Strategy

Posted: January 13, 2022 by Virendra Yaduvanshi in Database Administrator
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Databases are the lifeblood of every business in the modern world. Data enables them to make informed and valuable decisions. Insights, patterns, and outcomes – all require the best quality of data. Therefore, when it comes time to move from an older version to a newer version of the software, there’s a need for data migration planning.

The primary purpose of a data migration plan is to improve the performance of the entire process and offer a structured approach to data. Data migration policies are useful to eliminate errors and redundancies that might occur during the process.

There are a lot of complexities involved in the data migration process. It’s not just copied and paste data task– it’s much more complicated. We must have some data migration strategies and best practices for the entire process.

Data migration takes anywhere between a couple of days, months to a year. It depends on the amount of data, the capabilities of the legacy system, and the compatibility with the new system. While there are data migration tools and software that make the work easier, must need to have a data migration checklist for beginning the procedure.

Few data migration strategies point considered as,

  1. Prevent failure
    Data migration planning helps us to avoid failure. It outlines the problems that might occur from the beginning. Data migration should not have a casual approach. Cloud data migration projects require more critical attention to prevent errors and issues.
  2. Define the larger scope
    By following the data migration best practices, it can be as define the larger scope of migrating the data. Whether it’s due to the transition from legacy systems or upgrading the tools, a data migration plan enables determining what the process aims to achieve.
  3. Meeting deadlines
    it all becomes possible due to strategic data migration. Data is crucial at different stages, and it needs to be available at the right moment.

Data Migration Planning Checklist


There are many important elements to a data migration strategy. They are critical because leaving even a single factor behind may impact the effectiveness of the strategy. The data migration-planning checklist can comprise of the following –

  • Data audit
    Before migrating, we need to do a complete data audit. Knowing data is more essential than anything because that will tell about its characteristics.
  • System cleanup
    Need to clean up system with data migration software and tools to fix any issues that may arise. Third-party sources are more viable in this process.
  • Data migration methodologies
    Outline the techniques, procedures, and data migration steps as begin. Methodologies are important because they determine the success of the process.
  • Maintenance & support
    After migration, there needs to be regular maintenance and checkup of the data. Data may degrade over a period, so it needs to be assessed for any errors.
  • Data integrity
    Governance and compliance is important part of the data migration strategy. Regularly tracking and monitoring data quality is important to assure safety from vulnerabilities.

Data Migration Strategies and Best Practices

Data Migration - Spring Time Software

The best data migration strategies and best practices,

  1. Backup of data
    One of the top data migration best practices is to backup the data. At any level, it’s not affordable to lose even a single piece of data. Backup resources are essential to save data from any mishaps that may occur during the process. Backing up the data is crucial to prevent any failures during the data migration process that may lead to data loss.
  2. Design the migration
    There are two ways to design the data migration steps – big bang and trickle. Big bang involves completing the data migration in a limited timeframe, during which the servers would be down. Trickle involves completing the data migration process in stages. Designing the migration enables you to determine which is the right method for your requirements.
  3. Test the data migration plan
    We can never stress enough about the importance of testing the strategy we plan to choose. we need to conduct live tests with real data to figure out the effectiveness of the process. This may require taking some risks as the data is crucial. To ensure that the process will be complete, need to test every aspect of the data migration planning.
  4. Set up an audit system
    Another top data migration strategy and best practice are to set up an audit system for the data migration process. Every stage needs to be carefully audited for errors and methodologies. The audit is important to ensure the accuracy of data migration. Without an audit system, we can’t really monitor what is going on with data at each phase.
  5. Simplify with data migration tools
    It is important to consider a data migration software that can simplify the process. We need to focus on the connectivity, security, scalability, and speed of the software. Data migration is challenging when the right tools are not available.

Card Tokenization

Posted: January 12, 2022 by Virendra Yaduvanshi in Database Administrator
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Now it’s very frequent, the hackers break into a merchant’s computer system and steal credit card information, which they can use to charge huge amounts worth of stuff to your account. But imagine if instead of a person’s name, card number, expiration date, and other information, the hackers just got a meaningless jumble of numbers and letters – That’s credit card tokenization in action, and it’s a key way payment systems can keep card data safe.
Tokenization is a data security feature where a sensitive data element or set is effectively replaced (“tokenized”) with a non-sensitive alternative, called a token. This renders the data completely useless to exploitation. means, Tokenization replaces sensitive card data with a jumble of letters and numbers that are useless to a hacker. Tokenization can be used to safeguard any sensitive data like PII data, medical records, banking, and credit card payments. Credit Card tokenization is the process of replacing sensitive customer details with an algorithmically generated number that is impossible to trace back to the original data or information. The result – a (credit card) token – makes it impossible for anybody to misuse sensitive information, as the tokenization algorithm ensures that the data is unable to be traced back to its original source. As an example, when a customer makes a purchase using a credit or debit card, the tokenization process takes the card number and transforms it into a mathematically irreversible token. If the credit card number or account number needs to be billed again in the future such as for recurring payment or subscription, the payment system recognizes the token associated with the card, rather than the card number itself. Credit or debit card tokenization increases trust for organizations and significantly reduces the risk of sensitive data such as cardholder data being exposed.

The tokenization process can take many forms, but it’s useful to consider the following possible scenarios:

1. E-commerce Payment Tokenization

  1.  A customer makes a purchase and uses their credit card to check out (ex. 1234 4321 1234 5678).
  2. The card number is changed to a random sequence of characters (ex. EUSH127ABD5562).
  3. The relationship between the actual card number and the token is stored in a separate vault.
  4. If the transaction is recurring for a monthly or another subscription or a refund is required, the merchant can simply use the token rather than needing to store the sensitive card data itself.

    2. Mobile Payment Tokenization

    When users of Apple Pay or Android Pay add a credit card to their mobile device, each of the card numbers will be tokenized and stored on the phone. When a purchase is made, the token is used instead of the payment card itself, thus adding an extra layer of protection for the transaction.

    3. App Payment Tokenization

    Now days, using applications to purchase goods is becoming more common, If a user’s phone contains a token, these apps are unable to retrieve or access any credit card details. All bank details are locked down and hackers/fraudsters would be unable to commit an offense with the data available to them. Checking out to finalize a purchase is simple too as many apps are integrated to be linked directly with your stored shipping and billing information.

    The decrease in data theft and fraud as a result of tokenization means businesses are less likely to incur reputational or financial damage as a result of a data breach. Customers will also feel reassured and confident in shopping with merchants who utilize a tokenization process, as this shows a strong emphasis on protecting the sensitive information of the customer. Tokenization also has additional benefits, particularly when combined with PCI-validated Point-to-Point Encryption.

    Tokenization Vs. Encryption

    When data is encrypted, it is coded into a hidden language, similar to tokenization. However, encryption uses a mathematical formula that is possible to reverse-engineer, meaning encrypted sequences can be deciphered and risks exposing sensitive information such as credit card data.
    Conversely, tokenization turns a meaningful piece of data into a string of random characters that cannot be reversed – so if breached, no meaningful value is exposed. This is a huge benefit in the payment card industry, ensuring the highest security standard possible. The only thing a hacker would obtain is a list of token numbers which would be of no use to them. This makes credit card data unusable, adding additional layers of security.

    Benefits of Tokenization:
    Tokenization can provide several important benefits for securing sensitive customer data:

  • Enhanced customer assurance—tokenization offers an additional layer of security for eCommerce websites, increasing consumer trust.
  • Increased security and protection from breaches—by using tokenization, businesses do not have to capture sensitive information in their input terminals, keep it in internal databases, or transmit the data through their information systems. This safeguards businesses from security breaches.
  • Data tokenization improves medical records security—organizations can use tokenization solutions for scenarios covered under HIPAA. By substituting electronically protected health information (ePHI) and non-public personal information (NPPI) with a tokenized value, healthcare organizations can better comply with HIPAA regulations.
  • Tokenization makes credit card payments more secure—the payment card industry needs to comply with extensive standards and regulations. Tokenization solutions provide a way to protect cardholder data, such as magnetic swipe data, primary account number, and cardholder information. Companies can comply with industry standards more easily, and better protect client information.

Tokenization for Security and Compliance:

Tokenization can be approached on multiple layers of protection, including:

  • Database firewall—prevents SQL injection and similar threats, while assessing for known vulnerabilities.
  • User rights management—tracks the data movements and access of privileged users to identify excessive and unused privileges.
  • Data loss prevention (DLP)—monitors and tracks data in motion, at rest, in cloud storage, or on endpoint devices.
  • User behavior analytics—creates a baseline of data access behavior and uses machine learning to isolate and alert on abnormal and potentially dangerous activity.
  • Data discovery and classification—discloses the volume, location, and context of data on-premises and in the cloud.
  • Database activity monitoring—monitors relational databases, data warehouses, big data, and mainframes to produce real-time alerts on violations of policy.
  • Alert prioritization—using AI and machine learning technology to examine the stream of security events and prioritize the most important events.

Most Deadly Sins of Database Design

Posted: January 8, 2022 by Virendra Yaduvanshi in Database Administrator
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Pengertian pemodelan data ciri, jenis, tekniknya | AnakTik.com
If you don’t get the data right, nothing else matters. However, the business focus on applications often overshadows the priority for a well-organized database design. Several factors can lead to a poor database design — lack of experience, a shortage of the necessary skills, tight timelines, and insufficient resources can all contribute. Addressing some simple data modeling and design fundamentals lead to the right path. Here, I am trying to explain a few common databases design “sins” that can be easily avoided and ways to correct them in future projects.

1) Poor or missing documentation for databases in production: Documentation for databases usually falls into three categories: incomplete, inaccurate, or none at all. This causes developers, DBAs, architects, and business analysts to scramble to get on the same page. They are left up to their own imagination to interpret the meaning and usage of the data. The best approach is to place the data models into a central repository and spawn automated reports so that with minimal effort, everyone benefits. Producing a central store of models is only half the battle, though. Once that is done, executing validation and quality metrics will enhance the quality of the models over time. It will help in data management and can extend what metadata is captured in the models.

2) Inadequate or no normalization:
Sometimes it needs to de-normalize a database structure to achieve optimal performance but sacrificing flexibility will paint you in a corner. Despite the long-held belief by developers, one table to store everything is not always optimal. Another common mistake is repeating values stored in a table. This can greatly decrease flexibility and increase difficulty when updating the data. Understanding even the basics of normalization adds flexibility to a design while reducing redundant data.

3) Inappropriate data modeling:
There are numerous examples of customers performing the modeling upfront, but once the design is in production, all modeling ceases. To maintain flexibility and ensure consistency when the database changes, those modifications need to find their way back to the model.

4) Improper storage of reference data:
There are two main problems with reference data. It is either stored in many places or, even worse, embedded in the application code. Reference values provide valuable documentation which should be communicated in an appropriate location. The best chance is often via the model. The key is to have it defined in one place and used in other places.

5) Ignorance of foreign key or check constraints: End-users complain all the time about the lack of referential integrity – RI or validation checks defined in the database when reverse engineering databases. For older database systems, it was thought that foreign keys and check constraints slowed performance, thus, the RI and checks should be done via the application. If it is possible to validate the data in the database, can be done there. Error handling will be drastically simplified, and data quality will increase as a result.

6) Avoiding uses of domains and naming standards:
Domains and naming standards are probably two of the most important things that can be incorporated into modeling practices. Domains allow the creation of reusable attributes so that the same attributes are not created in different places with different properties. Naming standards allow to clearly identify those attributes consistently.

7) Inappropriate primary key: The simplest principle to remember when picking a primary key is SUM – Static, Unique, Minimal. It is not necessary to delve into the whole natural vs. surrogate key debate, however, it is important to know that although surrogate keys may uniquely identify the record, they do not always uniquely identify the data. There is a time and a place for both, and you can always create an alternate key for natural keys if a surrogate is used as the primary key.

8) Using a composite key: A composite primary key is a primary key that contains two or more columns. The primary key field serves a single purpose of uniquely identifying the row within the system, as a result, it’s used in other tables as foreign keys. Using a composite primary key means there is a need to add two or three columns in these other tables to link back to this table, which is not as easy or efficient as using a single column.

9) Poor indexing: Indexes on a database are objects that allow certain queries to run more efficiently. Indexes are not a silver bullet for performance – they don’t solve every issue. There are commonly three mistakes that are often done when it comes to indexes:

a) No indexes at all: Without the index, as the table grows with more data, then the queries will likely get slower and slower.

b) Too many indexes: Having too many indexes can also be an issue for databases. Indexes help with the reading of data from a table, but slow down the process of DML.

c) Indexes on every column: it might be tempting to add indexes to every field of the table, doing so can slow down the database

10) Incorrect Data Types: Due to incomplete knowledge about business flows, storing data in the wrong format can cause issues with storing the data and retrieving it later.

Leading Digital Transformation with Data Science

Posted: January 6, 2022 by Virendra Yaduvanshi in Database Administrator
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An immense volume of data is waving into and out in today’s businesses, but it becomes more complex to know how to convert this data into actionable insights. On the other side, data science has an incredible perspective for all types of businesses to design models that further define trends and use them as the foundation for transformative software, i.e. from locating IoT devices to predictive analytics. These models are used to augment customer experience, processing efficiency, user engagement, possible conditions where data can crack difficult problems. The market for Data Science services is increasing with the speed of light, it plays a vital and crucial role in helping to transform our business digitally when many companies are looking to unlock the strength of business data that lacks with the demanding proficiency and support.

Digital transformation is the all-embracing transformation of multiple activities that an organization control to leverage opportunities produced by digital technologies and data. It touches the ubiquitous era of digitalization regardless of the size and worthiness of the industry like,

  • It reflects the digital trends in terms of operations and policies that make severe changes in how businesses control and assist customers.
  • It depends on organizational data to achieve targets more efficiently and abandon values to customers, but how we catch in the next section.

The native components that are very likely to transform are its business models, operations, infrastructures, culture, sorted quantitative and qualitative modes of searching for new sources of customer values. No wonder, Digital transformation covered all the domains of business regarding product innovations, operations, finance, retailing marketing strategies, customer services, etc. The term “DIGITALIZATION” not only speeds up the business process and performance but also delivers business opportunities. It also improves the outpace of digital disruption and fixes the position of a person in the fast-growing business environment. Consider the situation where an individual wants to recognize

  • Which sections need to be transformed,
  • How to drop the risk factors,
  • How to withdraw unwanted pitfalls from resources.

Most of the industries have chosen data-driven approaches to digitally transform their businesses, infact various big data technologies are available to follow the appropriate data-driven approaches. In short, companies are using data science and associated technologies to make the environment completely digital, and BI for gathering, computing, and interrogating their business data that moreover can be turned out into actionable insights. The latest surveys show that more and more organizations are embracing data science as a service to reach a large resource of data experts for enhancing their decision-making. Experts are able enough to generate digital strategies and plans either in terms of increasing revenue and reducing costs or improving efficiency.

The below are the multiple ways when data science acts as services to add value in business.

Authorizing decision-making via a data-driven approach – Like data science, digital transformation is a convoluted process, i.e., customer data combined with appropriate business operations can leverage to make informed conclusions while restricting unwanted risks. With data science capabilities, we can find out how to transform business digitally and which area of business needs to transform.

Classifying warnings, opportunities, and scopes via data-insights – The volume of available information and insights are rapidly growing with the increased volume of data which indirectly initiates the opportunities and hence scope to grow for business as well as the individual. Data science services make organizations capable to cope with the deficiency of data experts and give a detailed description of their business environment. Data science is a technique that enables next-generation outcomes to predict what is going to happen and how to preserve it from risks if any. Data science enables organizations to have real-time visibility about their customers, support in making decisions to optimize the internal process for larger activity, expanded flexibility and reduce the cost.

Adding more values with Machine learning: Being a major part of the data science ecosystem, machine learning can stimulate digital transformation more effectively in bioinformatics and other industries. It supports to break massive data to identify trends and exceptions. One impactive approach is Artificial Intelligence which uses machine learning algorithms to deliver insights, designing timelines models and anticipating chances where disruptions occur.

Leveraging AI in Fintech

Posted: November 27, 2021 by Virendra Yaduvanshi in Database Administrator
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Coding Artificial Intelligence GIF by Matthew Butler


AI has a whole host of practical uses not only in the fintech industry but in the wider finance world, and even the wider world beyond that. The general gist of AI is that it solves problems, it allows companies to save both time and money. According to the prediction from many Research, AI technology will allow financial institutions to reduce their operational costs by 22-~25% by 2030. Adopting AI enables the industry to create a better environment for the customer, providing better customer service through a variety of different business activities.
In many instances, the practical use of AI is to do with data and enable companies to analyze that data in an efficient strategic way. Organizations particularly financial institutions will often have streams of data on their consumers but will rarely do much with it due to the time it would take to go through and analyze in order to find anything meaningful. This is where artificial intelligence comes in, as AI and machine learning are very effective at analyzing large amounts of data in real-time, then taking that data and drawing conclusions or recommending actions.
One example of applying AI with data is for banks to decide whether someone is creditworthy. Banks and other financial institutions want to be able to offer credit to their customers, but they want to be able to price for it accordingly, i.e., they don’t want to overcharge trustworthy customers or undercharge customers that may be more of a risk. Traditionally, to determine someone’s creditworthiness you would look at their credit scores, credit bureau data kept by agencies like Experian. However, by utilizing AI these institutions can look at their own customer data that they have and draw conclusions from there. From these large portfolios of consumer data AI can infer different kinds of relationships. Details like your job, where you live, or where you work are more obvious sources.
Another way AI’s data analysis can be used is for fraud detection and prevention. AI and machine learning solutions can react to the data they are presented in real-time, finding patterns and relationships and even being able to recognize the fraudulent activity. As we can imagine, this is hugely beneficial to the financial world as an unbelievable amount of digital transactions take place every hour, with heightened cybersecurity and successful fraud detection a necessity. AI takes the brunt of the work away from fraud analysts, allowing them to focus on higher-level cases while the AI ticks along in the background identifying the smaller issues. An example of how AI can detect through is by detecting anomalies, so going back to our banking scenario, perhaps a person has tried to apply for 10 identical loans in 5 minutes, the AI computer would be able to detect this as an anomaly and flag it up as suspicious. The machine has a baseline sense of what is “Normal” and when something deviates from that it can identify it and review it.
Other use cases of AI include automated customer support. We are all used to seeing chat boxes pop up at the bottom of our screens when we are browsing the internet, and these are of course AI bots primed and ready to help out. Companies can simply load up their most commonly asked questions and tell the BOT what answers to give, also instructing it to refer the customer elsewhere on more complex issues. Being able to answer frequently asked questions about the company or the product/ service it provides gives a better experience for the customer, as they get the answer to their query straight away, as well as saving the company time and money from not having to employ someone to sit and type responses or can have a worker direct their attention elsewhere. 

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