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Banks, Financial Platforms and Big Data: Development Trends and Regulation Directions

Author

Listed:
  • Sergey A. Vasiliev

    (International Banking Institute named after Anatoliy Sobchak, St. Petersburg 191023, Russian Federation)

  • Irina A. Nikonova

    (International Banking Institute named after Anatoliy Sobchak, St. Petersburg 191023, Russian Federation)

  • Olga S. Miroshnichenko

    (University of Tyumen, Tyumen 625003, Russian Federation; RANEPA, Moscow 119571, Russian Federation)

Abstract

The introduction of Big Data technology into banking activities is aimed at improving the efficiency of banks, improving business processes, however, it creates new risk factors and determines the need to transform regulatory approaches. The purpose of the article is to develop recommendations on the use of Big Data technology in banking, including the bank transactions using a financial platform, taking into account the need to ensure the stability of the banking sector at the macro and micro levels, and the development of the financial market. It has been established that Big Data technology is used in the management of banking risks, in the development of relationships with customers, the development of personalized products; in cost reduction. The use of Big Data defines new requirements for staff competencies. As a result of the analysis, the need for cooperation between banks, operators of financial platforms with specialized providers of cloud services, software, as well as fintech companies is substantiated. It was revealed that the implementation of Big Data technology increases the importance of model, reputational risks, third-party risks, unethical behavior, and cybersecurity. When using Big Data technology, banks are recommended to separate the data management function; the regulator — to expand the regulatory principles and approaches to the use of data in the construction, validation, adjustment of banking models based on Big Data technology, to the exchange of data and their protection, to the use by banks, operators of financial platforms of Open data, to the certification of specialized suppliers, interacting with banks; the legislator is recommended to develop a legal framework that regulates the formation and use of open data by economic agents.

Suggested Citation

  • Sergey A. Vasiliev & Irina A. Nikonova & Olga S. Miroshnichenko, 2022. "Banks, Financial Platforms and Big Data: Development Trends and Regulation Directions," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 5, pages 105-119, October.
    • Handle: RePEc:fru:finjrn:220507:p:105-119
    DOI: 10.31107/2075-1990-2022-5-105-119
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Big Data; bank; financial platform; fintech; open APIs; model risk; Open banking;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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