Today’s world is packed full of data. Dozens of pieces of data are gathered every day about each one of us. Some may see this as a good thing, while others may see it is a negative.
What is Data Aggregation?
Data aggregation is any process where information is gathered and summarised for various purposes such as statistical analysis. Digital data aggregation also boosts accuracy and helps prevent fraud.
By being able to digitally access customers’ financial information, banks and financial institutions are able to service their clients’ demands faster than via non-digital methods. This digital automation is changing consumer experiences across the financial industry in three main ways, outlined below:
In order to be able to budget well, consumers need to have a full and up-to-the-minute picture of their financial health comprising of income, expenses and debts. Data aggregation enables all of this data to be held in one location. Existing private financial management apps such as YNAB or Mvelopes, use data aggregation to enable consumers to view all their financial transactions in one place, as well as to plan for future spending.
Data aggregation means that lenders can review transaction histories and confirm an applicant’s income/assets within minutes of credit applications being made. For consumers, digitisation can help eliminate the need for excess paperwork and remove the need to track down physical financial statements/payslips etc. In order to apply for credit, applicants only need to give permission for their data to be shared in order for credit reports to be generated – this means decisions can be reached in a matter of hours rather than weeks.
Data aggregation means that financial advisors can see an overall snapshot of their clients’ finances without having to gather the details themselves. In turn, this frees up time to give actual advice. Having said that it has helped financial advisors, this data aggregation has also led to robo advisors becoming increasingly popular.
If you are interested in back office systems for financial advisers, then why not take a look at the website of a specialist such as https://www.intelliflo.com/, today.
Data aggregation will no doubt lead to an increase in the number of apps and services aimed at helping individuals and organisations improve their financial wellbeing.