Dec 9, 2020

Data-as-a-service in the financial world

Critical Software
Digital Transformation
Critical Software
4 min
Data-as-a-service in the financial world
Data-as-a-service is key to banks’ digital transformation. But how can they make the most of this dynamic approach to data management...

Data-as-a-service is key to banks’ digital transformation. But how can they make the most of this dynamic approach to data management?

Data-as-a-service (DaaS), the practice of sourcing and analysing data on demand rather than completing full and formal data transformation, has reinvented the way institutions handle their data management capabilities. Institutions have been granted the ability to manage their data in an ad hoc yet fully accessible way, enabling them to drill down to the most relevant data needed for a specific task. 

But what hurdles must incumbent banks overcome to ensure efficient data-as-a-service functionality? And what new methods are emerging in terms of managing and using data in financial services?

Implementing DaaS 

Incumbents often face the issue of their data tending to be unorganised and/or inaccessible. Related datasets are not linked, meaning few useful insights can be drawn from them. What’s more, the sheer volume of the data stored by institutions could mean processing it becomes too time-expensive an activity when weighed against any derivable insights. 

DaaS provides some solutions to these problems. Chiefly, it enables the simplification of data outputs, generating coherent datasets in which any present trends can be identified. It can also reduce the time taken to process data which, for many incumbent institutions and their vast data reserves, could otherwise take years. 

DaaS can also be useful in uniting datasets in an easily understandable way, working in tandem with data visualisation tools. This not only enables dataset comparison but also ensures the compatibility of data between systems.

Targeting the right data

In a sector where the level of data processed on a daily basis is so vast, it is pivotal that institutions are able to derive the most useful insights from any data produced. This year, the amount of data processed by institutions was expected to increase by up to 200%. DaaS, then, provides a platform to easily access and leverage this data. But is it enough? 

Many DaaS platforms promise streamlined data access and management, reducing the need for thoroughly planned extraction and analysis projects. Yet this mindset may encourage institutions to cut corners, instead handing responsibility for data management over to their DaaS partner (i.e. a third-party who builds and sometimes runs their DaaS platform). It is therefore key that institutions do not see DaaS as a means to absolve themselves of the responsibility of continuously improving their internal data stores. Instead, it should be seen as a potentially powerful tool providing strong and previously unattainable insights, with the onus being on the DaaS partner to give institutions suitable visibility and training of the platform to enable autonomous use beyond the timescale of the project itself.   

Scaling on up…  

DaaS offers a dynamic solution to dealing with high volumes of complex data. Institutions can use it to scale up and down their data access when necessary, producing cost and resourcing benefits.

Scalability also suits the current nature of institutions and how they are developing to meet the challenges of modern finance. The emergence of FinTechs has meant scalable solutions are integral for servicing the needs of these ever-growing institutions at any time. 

Yet the same goes for incumbents. Institutions just beginning their digital transformation may only require limited data management at first, yet as these operations grow and new avenues of opportunity are explored, so too will their data management needs. While the rigidity of internal data warehouses would constrain their ability to expand, DaaS gives institutions the required flexibility to keep on top of increasing data demands. 

Future struggles

Digital is the here and now when it comes to managing data in financial services, but that doesn’t excuse stasis in these areas. In 2017, a Gartner Hype Cycle of new technologies in financial services predicted that adoption of DaaS was still at an early stage, with peak adoption occurring in or around 2027. 

As financial institutions become more digital-savvy, the opportunities opened up by DaaS and other ‘as-a-services’ will be more keenly felt. Rather than adopting cumbersome data management processes, institutions will likely prefer to approach data on an ad hoc basis. Some fintechs are already doing this, including a UK-based challenger bank which manages its over 800 dashboards and 100,000 SQL queries using flexible and dynamic analytics platforms based on a hybrid cloud environment.

Data-as-a-service enables access to the right data services at the right time, reducing costs and the time spent managing data. But institutions themselves must be responsible for identifying the potential rewards that can be reaped from DaaS and ensure that data harmonisation takes place. Used correctly, DaaS can be a powerful tool in banks’ digital transformation efforts. 

To learn more about Critical’s work in restructuring banking ecosystems, check out our case study on the subject here.

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Jun 20, 2021

4 ways to digitally enhance an insurtech customer experience

Stephanie N. Blahut, co-founde...
5 min
Stephanie N. Blahut, co-founder of B2Z Insurance, explains how insurtechs can build relationships with customers through data-driven innovation

Insurtechs run the risk of cannibalising their own mission to boost coverage by getting sidetracked focusing on the latest and greatest technology.

These folks may advertise an end-to-end digital experience, but behind their slick customer-facing portals, they struggle to overcome the same problems that established insurers still face: a broken customer experience.

If an insurtech platform delivers a digitised version of a broken process, shoppers may be deterred by the same pain points that they were hoping to avoid by going with the more modern insurer. This might mean that shoppers are required to fill out a series of confusing forms that don’t apply to their industry or even be required to pick up the phone and wait in a queue to secure the quote they got online. Spoiler: neither experience leads to conversions.

As the Chief Marketing Officer and company co-founderI’m a fervent advocate for putting small business owners and their customer experience (CX) at the center of insurtech product design. At B2Z, we provide digital, self-driven business insurance to small business owners by amassing digital intelligence through vast amounts of data, then leveraging it to streamline their insurance experience. That’s because our audience doesn’t have time to pick up the phone and wait to talk to an agent or chase emails over days or weeks waiting for a coverage decision.

1. Excel where others fall short

To understand where you can improve your CX, start by auditing the current insurance experience for potential customers in your target market. By identifying the common touchpoints and locations along the customer journey where the competition falls short, you can also find opportunities to pull ahead.

At B2Z, we found that most policy offerings were cumbersome and incomplete, but there were two major pain points we saw time and again:

  • Irrelevant questions led shoppers to question whether they were applying for the right product. Small business owners could receive a quote after answering questions in an online form, but the process wasn’t tailored to their business. For example, pet retailers would be asked about liquor sales at their establishment.
  • Shoppers couldn’t complete the process entirely online. Even after they were promised a completely digital experience, too many small business owners were required to follow up over the phone to secure coverage.

Why are these such serious issues? Small business owners are busy people. More than 70% of them work more than 40 hours per week as they fill a variety of different roles across their organizations.

This disjointed process left busy entrepreneurs with coverage gaps or uninsured altogether: over 70% of small businesses are underinsured, and 40 percent aren’t insured at all. And having the right kind of insurance can be the difference between a business shutting its doors or enduring. This landscape created an opportunity for thoughtful technology to improve the customer experience.

2. Use technology to solve pain points

In the property and casualty space, insurtechs can shrink expense ratios to almost 40% lower than those of traditional insurers. But they don’t do this by implementing technology for technology’s sake. Instead, they identify and target specific areas where tech can improve the customer experience and they strategically design the right solution for their customers’ needs.

Our work with chatbot design is a great example of how insurtechs can leverage innovative tech to differentiate their products and services.

Most insurtech chatbots are equipped to answer simple, formulaic questions you’d find in the FAQ section of their website. While this type of bot helps shoppers and customers access the right information at the right time, their limited natural language processing capabilities too often means customers must input the exact keywords to get a helpful response.

After examining where other chatbots fell short, B2Z developed Diya, a digital guide to small business insurance. During the application process, Diya chimes in at potentially challenging moments to ensure small business owners quickly secure the right coverage. 

For example, when asked to select their business classification code, customers can type, “I cut hair” and select from relevant codes for barbershops or beauty salons.

By being purposeful about implementing new technologies, insurtechs can streamline the customer experience and differentiate themselves from others in the space.

3. Align your CX with customer expectations

The pressure is on for insurtechs to match the digital experience customers now expect when they shop for groceries or refill their prescriptions.

The COVID-19 pandemic changed behaviors and accelerated customer expectations for entirely digital experiences (which have existed since at least 2015). In the US, 73% of customers have tried new shopping behaviours since June 2020 and over 75% intend to continue them. 

To achieve this, insurtechs must leverage data to streamline the customer experience. At B2Z, we leverage our digital intelligence to help small businesses quickly identify the right coverage options based on the risks within their industry.

For example, to gauge the right level of coverage for a contractor, we need to know whether their employees regularly work on platforms more than 15 feet off the ground. Rather than asking the business owner to provide this information, we leverage third-party data, and our algorithms review county records of similar businesses.

Then, by collating this information with millions of other contractors across the country, we can automatically match their business up to an existing model from an underwriting perspective. This leaves the customer with fewer questions to answer manually, streamlining the customer experience and shortening the application process to as little as five minutes.

By drawing from all available data sources, insurers can deliver a speedy, fully digital customer experience while holistically evaluating customer risks.

4. Every digital touchpoint is an opportunity to enhance the customer experience 

As insurers rush to adopt new technology, incumbents and insurtechs don’t consider how their decisions will impact the customer experience.

By taking stock of the competition, implementing new tools that are designed for a specific purpose, and using data to gauge customer expectations (and design to meet them), you can keep your customers at the centre of an increasingly digital experience.


About the author: Stephanie N. Blahut is CMO and Co-Founder at B2Z Insurance. B2Z Insurance is a new small business insurance company that provides coverage for on-the-go business owners: simple explanations, easy application, digital quotes, and mobile claims. Stephanie is a seasoned digital marketing professional whose experience spans the insurance, publishing, and software industries. As B2Z’s CMO she leads their digital-first customer acquisition and marketing strategy.


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