Without fully understanding how your customers are spending and utilising their money, it can be challenging aligning them and selling them on the need for future financial products.
Without a tool such as categorisation, while bank statement information is available, this is raw data and little can be gleaned from it. It is only through a tool such as categorisation that this data can be enriched to the point that insights can be made.
The solution comes in being able to categorise the spend of customers.
Categorisation is where a consumer is spending their money on a daily, weekly and monthly basis, and from this, a much richer and more accurate representation of the consumer can be built.
Categorising consumer spend comes with a number of other significant benefits, such as reducing operational cost. Categorisation can also work as the driving force behind more complex financial products that without it would be impossible to build and bring to market.
The ability to categorise a consumer’s spend allows lenders to build a complete profile of an individual, on which more complex financial instruments can be built and sold. The raw data offered through Open Banking is only data, is needs to be manipulated and understood in order to derive any serious benefit from it.
Understand how a consumer spends their money.
Enrich customer transaction data to give a full understanding of them.
Build on the transaction data to form the basis of other financial products.
Manipulate the data in any way that you want to build new offerings.
Categorising customer transactions is a key component within credit risk.
Categorisation can drive insights such as behavioural analytics.
James Varga, CEO, DirectID
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