Asian banks seem to have learned their lesson during the Asian financial crisis in the late 90’s and thus came out of the global financial crisis much more quickly.  However Asian banks aren’t in the clear. Many lack strong data infrastructure. That’s a big problem says Rita Chakravarti in a recent FICO banking analytics blog:

It’s a priority for these banks to enhance analytics capability—and now is the ideal time to make that investment. The world is gathering more and more data, storage is becoming cheaper, the business environment is extremely competitive, and cost reduction is a top priority in everybody’s mind.

Internal customer behavior data is an untapped goldmine for every company. Mining is the only way to reach that. However to be successful in analytics, having a good data infrastructure is a must. As little as 10 years ago, banks could survive and make money without investing in a good customer database. In today’s volatile financial world, this is suicidal.

Inadequate data infrastructure is a harsh reality for many banks and FIs in Asia Pacific. This creates a major roadblock for intensive analytics activity, which many believe is a major growth driver. Sometimes large IT vendors, who are the primary service providers for DWH/data mart creation, end up creating infrastructure that is extremely complex and not user friendly. This happens primarily because of the lack of appropriate business input while creating the infrastructure. 

Banks and FIs need to address this quickly and, if necessary, solicit professional help to provide essential business inputs to IT companies, in order to create state-of-the-art, simple, user friendly data infrastructure.

According to a Gartner report, the forecast in IT spending in 2011-2014 in Asia Pacific will be more than 6% annually, the highest among all regions worldwide.  If all that money is not spent wisely, true analytics maturity may end up being a mirage.   Source:  Bankinganalyticsblog – FICO

BIIA picked up a story in ‘The Asian Banker’ Issue 102 with the title ‘Turning Data into Business’.   The author Neeti Aggarwal, CFA stated that managing data is the challenge:  “The amount of data generated today is increasing exponentially and the management of this data is becoming the biggest challenge in the development of analytics capabilities.  Differentiation can only result from the complete and timely integration of customer transaction, product and interaction data for analytical purposes.  Currently, information continues to reside in product silos, and most banks struggle to keep dynamic data such as customer contacts and customer behavior updated.”  Source:  The Asian Banker Issue 102