The Age of 'Big Data' is Here
With the release of the Productivity Commission’s ‘Inquiry Report on Data Availability and Use’, it is clear that there is an expectation that by dramatically increasing the variety and volume of data available to Australian businesses, benefits in the form of new products, efficiency, safety, productivity and better decision making will accrue to both individuals and businesses. As with each disruptive business revolution, there will be businesses that gain significant advantage from early adoption of these new opportunities, and there will also be those who refuse to embrace the opportunities that this type of reform will enable.
The hope for the retail credit industry is that we can avoid the risk averse approach that has so far tarnished the implementation of Comprehensive Credit Reporting (CCR). We have seen a slow adoption of CCR, mirroring the experiences and mistakes of other markets such as the UK. It is clear that the ‘age of Big Data’ is now upon us, and cannot be reversed – the businesses that will prosper and flourish are those that embrace these advances, spend time looking for new and insightful information about their customers or prospective customers, and then figure out how to operationalise these insights. The adoption of CCR in New Zealand has shown double digit growth in new businesses, and adverse selection in those who are slow to follow. This shows that being ‘ahead of the curve’ initially reaps rewards for the businesses that do so.
Mike Cutter, Executive General Manager, Customer Solutions