"Your data is brilliant," pronounced Martina King, CEO of Featurespace, to the audience at 2016 FT Banking Summit, held this year at London’s Intercontinental Park Lane. Marco Bressan, Chief Data Scientist at BBVA and responsible for helping the bank become a data-driven business, talked about the volume of data at the bank’s disposal.
As ever, the event had a mix of quality and sometimes surprising speakers.
Given that Martina heads up a business which uses artificial intelligence (AI) to detect risk in corporates, this is hardly surprising. And it’s also not particularly noteworthy that her fellow panellists who had assembled to discuss "The Use and Abuse of Big Data" - all of whom employ data in their roles - felt the same way. However, this was not just a general point that the Featurespace CEO was making and her fellow panellists were endorsing - the theme of the panel was that that data can significantly improve financial services for the consumer and that consumers had the power to control it and make it work for them.
Marco Bressan, Chief Data Scientist at BBVA and responsible for helping the bank become a data-driven business, talked about the volume of data at the bank’s disposal. “For other companies, they have to purchase income and expenditure data, and then use machine learning to interpret it. For BBVA it’s an SQL query.”
He gave examples of how data is already making a difference for BBVA.
"Using our data, we’ve been able to enhance volumes in small business lending without a corresponding rise in defaults," said Bressan. For retailers, he explained, this could mean using transaction data in assessments. "You’re always going to need soft data - for example, the strength of the relationship between the customer and the bank - in making business loans but better data helps decisioning," he said.
BBVA's Marco Bressan, right, at the FT Banking Summit. - Jonathan Birch / FT live
Panelist Brian Norton, co-founder of student financing business Future Finance, said that the business was looking beyond traditional forms of data to help with their decision-making. Firstly, he pointed out, students had very ‘thin files’ - limited credit history largely because of their age. More importantly, they needed data that ‘looked forward, rather than back’ - referring to a student’s earnings potential.
So Future Finance have made use of publicly-available earnings and employment data relating to universities. Norton stated that he wanted to make data work for his customers. “We ask customers to start paying back their loan when they’re at college - the data then goes to credit reference bureaux and helps their credit score.”
Using data to improve individual products for customers is of course important, according to Bressan, but it needs to break out from narrow product use to transform. “To really change things, it needs to be used in everything by everyone at BBVA - and that’s starting to happen,” he said.
Panelists were asked what customer benefits data use will bring in financial services in 10 years time. Norton talked of “effortless credit”, where machine learning will remove the need for form filling and meetings and automatically extend credit when your accounts reach a certain point.
BBVA’s Bressan also believed AI would play an important role, but in a slightly different way. “It won’t just be transactional, eg. asking chatbots how much money you have in your account,” he explained. “It’ll be AI providing genuine financial assistance - suggesting you give dining out a miss for a couple of months while you pay off a particular bill.”