Trusting low-quality data, especially inaccurate master data concerning customers, products, and locations, can impede growth and effective digital transformation. To drive growth and revenue in the financial master data management services industry, data modernization is crucial. With a trustworthy financial master data management services industry, organizations can carry out digital operations and financial services data analytics successfully, making financial (MDM) an indispensable factor for financial services data management.
The Significance of Master Data Management in Financial Services
MDM plays a vital role in financial services data management in improving results, while also minimizing the risk of customer fraud, alienation, and non-compliance. Up-to-date reports on customer purchase history and interests are essential for organizations to optimize sales activity and increase profitability by offering relevant products and services and all this is integral to financial services data management. Therefore, financial service organizations are increasingly adopting financial master data management (MDM) to drive their digital transformation.
MDM Financial Services has an impact on business processes in the following ways:
- Master data management financial services can improve business processes by enhancing current sub-optimal processes such as credit risk assessment during customer on-boarding. Without MDM financial services, there is a risk of mistakenly rejecting or approving customer credit.
MDM financial services enables the implementation of new processes that were previously not possible. For instance, cross-selling or upselling during customer on-boarding. Without proper financial data management solutions, there’s a risk of attempting to sell a product that the customer already owns or has rejected previously, violating their privacy preferences or regulations.
Importance of MDM as Financial Data Management Solutions
Software systems often have lists of customer data that are shared among different applications. This data usually changes slowly over time, unlike transactional data that changes with every interaction. This customer data is called “customer master data” and is one of the valuable assets of a company.
The purpose of MDM is not only to correct, enhance, connect, and unify financial data, but also to create a “golden record” of this data that references customer master data across all operational systems. This enables organisations to achieve their digital transformation goals by providing a “single view” of customer data: a comprehensive, consistent, and unified representation of customer data that can be viewed in one place.
By allowing trusted access to both customer master and transactional data, MDM works as the key financial data management solutions that enables data stewards to automate business rules that can be executed across boundaries that previously required manual processes during or after the current operation, or were not automated at all.
MDM for Financial Services
MDM establishes new data quality standards based on the enforced master data model across all entry points. It ensures that trusted data is automatically shared between systems through an interface that provides real-time access to this data. Moreover, semantic reconciliation models the definitions of customers, products, and other entities across the organisation. This makes MDM the first time the business is accurately modelled in terms of financial services data analytics.
Financial services firms and organisations can benefit from MDM by utilising customer metrics, targeting customer communications, monitoring all asset transfers, increasing fraud prevention, complying with regulatory requirements, and enhancing product searchability. MDM helps them navigate the current environment and prepare for the future.
Master Data Management: The Key to Achieving Optimal Results in Financial Services
Master Data Management establishes a robust base of reliable data for financial services firms. It improves the quality of data by modernising customer master data, minimising risks, and unlocking opportunities for generating revenue.
To learn more about how Posidex’s Master Data Management solutions can help optimise your financial services organisation, contact us today for a consultation.