Fintech is about embracing innovation to improve the financial services offered to consumers. With the digitization of our everyday lives, various fintech companies are popping up and coming up with new ways to provide financial services through technology. Many of these companies focus on specific areas related to finance and give customers easy access to tools they need without having to go through a bank or other traditional financial institution.
An account aggregator can provide users with access to their financial data in one place instead of having multiple logins for various services.
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How do AAs work?
A bank account contains private data that is owned by the account holder. However, account holders may want to share their data with a third party in order to receive specific goods or services. When requesting a loan from a credit institution, a person might submit a risk assessment. In this case, the account holder may give the account access credentials to a third party, who may then access the account and provide various services.
Banking APIs utilise a specific nomenclature to refer to requests, allowing third parties to obtain various types of information corresponding to their specific demands. As a result, account balance, bank statement list, and account owner data are some of the most commonly accessed data types. The bank must process the request to read the data (“bank id”) and read the user and password.
These will correspond to the individual’s online banking credentials in a real reading, as they do here. The request is authorized by the bank after receiving the correct credentials. Request types like the one in the picture return the following data: account owner name (“account owner”), iban (“iban”), bank cards and loans associated with the account (“cards” and “loans”), statements for every account (“statements”), and the start and end dates (“start_date” and “end_date”).
The data will be processed in order to accommodate the firm’s distinct usage scenario, whether it be for pure data output in JSON format, which may be utilised by applications to integrate into business processes, or for export in one of several formats (PDF or CSV, for example). Visual interfaces can also be created in order to view the data, such as analytics dashboards.
What is the importance of account aggregation services?
Lets discuss the importance of account aggregation services
1. Banks can improve user experience and design
By tweaking the app. Banks can gather all their users’ account information in one location using account aggregator, making the app the most convenient place to view balance information. This will help customers manage their money better, increasing user involvement with the app.
2. Verification for non-performing loans
Banks earn a lot from lending, but issuing the incorrect amount of money to the incorrect individual can result in non-performing loans. Non-Performing loans are an important part of the banking business, but keeping them under control is important for profitable operations. Account aggregation allows banks to evaluate a borrower’s financial health instantly and determine whether he or she is a good credit prospect. Banks can avoid bad loans or provide better terms by including this data in their credit evaluation process.
3. Counter-Challenge
The Open Banking movement and advancements in design and technology over the past decade paved the way for neobanks and startups to emerge, despite their products being niche and relatively limited compared to traditional banks. Traditional banks already have plenty of profit-making products, so they can counter-challenge their challengers by leveraging account aggregation.
To counter their challengers, traditional banks can build a compelling banking application by leveraging account aggregator, collecting all of their customers’ global bank accounts, whether provided by the bank or by its competitors. Banks can then offer the user a range of insurance, credit, and other business products that their challengers do not have, in addition to categorization insights.
4. The way consumers manage their money has become increasingly complicated
With more ways than ever to save and borrow money, it can take time for consumers to keep track of every transaction. What’s more, managing multiple bank accounts and credit cards can be cumbersome. Anumati AA integrates multiple accounts of consumer financial information into one single dashboard. The result is a simplified way to manage multiple accounts while providing access to the most relevant information.
5. A wide variety of financial account aggregation capabilities exist
and banks are adding new features as they adopt the technology. While some products are still being developed, others are already available, and more are on the way.
What are the benefits to the financial sector?
1. Banks that partner with AAs to provide the most recent and advanced data aggregation services can rest assured that consumers will remain loyal customers.
2. With data from various sources and over a hundred different financial service providers, it can be difficult for banks to create the most effective marketing campaigns for their customers. Anumati helps banks do just that. A data-based bank marketing campaign lets you create customized messages, emails and in-app notifications for your customers.
And because they have access to thousands of financial institutions around the world, you can target millions of potential customers. Anumati works on the premise that financial data provides a huge amount of insight into well-being and financial potential. By analyzing this insight, you can create marketing campaigns that provide the right messages at the right time.
For example, the reports help you understand better how your customers spend and save. They also show how millennials feel about credit, money management and financial success. And you’ll learn how to take advantage of this insight to increase your loyalty and improve your financial performance.
Summary
Using data analytics to improve financial experiences is not new. Since the dawn of the internet, it’s been enough for banks and financial institutions to offer their customers basic banking services. Today, consumers have more options for financial services than ever before. The good news is that banks are getting better at making their products better.
The good news is that the market leader in financial data aggregation (Account Aggregator), Anumati, can help them better meet their customers’ needs. Banks can better serve their customers with a focus on increasing engagement, better financial advice, and better user experience. Anumati has the data analytics capabilities banks need to make it happen.
