The disciplines of predictive analytics and forecasting play a major role in financial services. Applications of analytics are plenty – credit scoring, claims processing, hedging, portfolio analysis, and customer analytics to name a few.

From improving internal efficiencies (improving yield on debt accounts, selecting the right relationship manager) to increasing bottom lines (identification of price-insensitive customers, profitable brokers & regions, product bundling), companies must use analytics to survive and in turn excel.

Organizations, with the help of analytics will find effective ways of increasing the lifetime value of a customer. Analytics can help identify cross-sell and up-sell opportunities to improve the campaign response rates, identify customer purchasing patterns and increase revenues & customer loyalty.

Analytics can help organizations manage the market risk they face in terms of fluctuations in interest rates, exchange rates, commodity prices etc. Hedging strategies can be improved due to the insights gained from analytics.

DecisionCraft has been working with clients in the finance domain on a wide array of problems that include:

• Modeling INR-USD currency options using an improved Black-Scholes model
• Developing a credit rating model for a retail lending institution using Artificial Neural Networks
• Customer profiling and segmentation
• Product positioning using analytics