Open API Economy - Right Time For Banks To Flourish

Posted by Kimi Mahajan on Oct 25, 2019 2:39:38 PM

Banking and financial institutions are experiencing some drastic changes with the introduction of API in the Fintech ecosystem. So much so, that the APIs are termed as key enablers to create new value chains and empowering owners of financial data.

While this has accentuated the opportunities for delivering more customer-centric services, regulations and directives are disrupting the understanding and decisions. Let’s understand if it is the right time for retail and corporate banks to opt for API centric ecosystem?

Rising Trends in the Banking Industry

The open API economy is accelerating competition and innovation within the banking industry by creating new demands for banks’ business strategies. It is creating a wave for leading future banks to focus on their end customers and deliver new products and services through collaboration with business units within or outside a bank, across the industry to accelerate their market position.

Europe has taken the lead in API banking space with the Payment Services Directive(PSD2), directed to regulate payment services in the European Union and European Economic Area. It aims to increase pan-European competition and non-banks participation in the payments industry for increased consumer protection for online payments with strong customer authentication. PSD2 has been implemented to prohibit the use of non-transparent pricing methods for international payments to make the customer aware of the real costs involved.

The new regulation will, therefore, help to make international payments as straightforward and secure and will be more competitive offering greater choice for consumers. Its purpose of building a clear and comprehensive set of rules to existing and new providers of payment services will ensure greater efficiency, choice and transparency in a harmonised payment market.

open-api-economy

This digital market trend of open APIs will reduce costs of operation through higher competition, and bring about a new host of products and services through innovation leading to improved customer experience, increased transparency, modernize legacy technology, meet regulatory requirements, and generate new revenue. Banks will witness fragmentation with new competitors entering the market and potentially disintermediation from their customers.

Market disruption, client evolution and regulatory changes in open banking revolution are clear signs in banking and corporate world that customers are being presented with the high-end competition, innovation, and payment mechanisms. 

The Modern Era of Open APIs and Microservices

With the emergence of open API economy, there is a gigantic increase in the number of new entrants entering the financial services markets. Banks are opting for API-first strategies to define their business model, by facilitating their customers to have on-demand products and services. 

Financial Technologies (or simply referred as FinTechs) have disintermediated banks where end-consumers are confident in engaging with a variety of financial transactions, lending or depositing. Bigger technology giants too are advancing their game in the financial services business and exploring the possibilities by entering the payments market and preparing for further disruption.

open-api-economy

Open API banking has lead to an interesting era of banking transformation. Now, banks are adopting short- to long-term strategies to accelerate value delivery through FinTech partnerships. 

However, for its foreseen successful adoption, banks would need to establish the right operating model to drive profitability, ensuring that security standards are conformed with changing business model. As non-banks start accounting for most chunk of customer interaction, banks may find it difficult to differentiate themselves from them and convince customers to buy their services. Hence they would need to refine their data strategy to ensure its maximum leverage.

The banks are adopting microservices-based architecture for application development. It is an approach to which a large application is built as a group of modular services (with a specific business goal) which communicate with each other through open APIs using a well-defined interface. They have the ability to assemble as required to deliver complex functionality, and can scale independently.

The benefit of building microservice-based digital banking solutions is that the entire system won’t be down if one service fails. 

Microservices has brought down monolithic-based applications, focussing more on building agile and scalable solutions. Companies have started shifting towards agile delivery and devops as they would want to move from struggling with legacy applications holding back digital acceleration and innovation. 

This is the time when open API banking combined with microservices-based architecture will define success for banks.

Microservices based web applications are more agile, resilient and scalable. In the current scenario, when banks are seeking to accelerate the digital value propositions at lightning speed for flawless customer experience, opting for microservices approach is the fastest way to accelerate this transformation.

However, banks would need to strategize and will have to rethink their operational support, delivery methodology, and required skills to upgrade its people, process, and technology to enhance their core offerings.

The rising open API economy represents a great opportunity to gain a competitive edge in an increasingly complex and customer-centric marketplace. Despite the strategic and operational challenges, leading corporate and retail banks should realize that the time to act is now.

Topics: Financial Services, API Management

Embrace These 6 Technology Trends to Level Up Your Game in FinTech Industry

Posted by Urvashi Melwani on Sep 26, 2019 12:56:00 PM

 

The financial services space (FS) have been lately experiencing the transformation from multiple forces including demographic and social changes to the considerable rise in the adoption of the financial technology. The shift to this new digital model will make the lives of consumers more comfortable eventually and they will be able to experience the services seamlessly. 

So, let's deep dive to know further about the key technology trends that are disrupting the FinTech industry to bring you up to speed on events-

1. Increase in Cloud Adoption By Banks & Financial Institutions

The cloud adoption rate has increased significantly in recent years and has helped in elevating the scope and pace of innovation. As per International Data Corporation estimates (IDC), global spending on public cloud services and infrastructure is expected to grow at a CAGR of 23.8% over 2018 to reach USD 210 billion in 2019 and is forecasted to grow at a CAGR of 22.5% during 2017-22 to reach USD 370 billion in 2022. 

Further, the banking industry is expected to spend more than USD 20 billion on public cloud services in 2019, which indicates the vital progress it has made into the industry.

Cloud captured in circles and connected with various devices

The past has witnessed FS players leverage cloud-based software-as-a-service (SaaS) primarily for non-core applications such as CRM and HR. However, it’s no more same as they are now increasingly using the cloud infrastructure for delivering core applications too.

Cloud offers the following advantages-

  • Improves the speed of innovation

By reducing entry barriers for FinTech innovators, who primarily operate on cloud-based platforms. 

  • Improves the speed to market 

Enables the rapid development of applications and reduces the time and cost of setting up a new server by eliminating the need for organizations to invest in.

  • To gain insights on customers’ preferences

FS players are using the cloud as an analytics platform to derive customer insights by accessing data from multiple partners through application programming interfaces and microservices, helping them to respond to customer needs swiftly.

Moving forward, as digital transformation gathers pace, the potential benefits of the cloud would be hard enough to ignore, making it critical for enterprises to promptly act on their cloud strategies.

2. Securing Up Digital Property Will Be the Top Most Priority Of the FinTech Sector

Financial services executives are already very well-versed with the long-lasting impacts that these cyber-threats leave on their industry. 

The fast-paced digital transformation and elevating interconnectivity in the FS have allowed cybercriminals to target extremely sensitive financial information due to which huge operational, reputational, and financial damages have been incurred by organizations. Unfortunately, this will take some time likely to change for the better due to the following forces-

  • Use of third-party vendors
  • Rapidly evolving, sophisticated, and complex technologies
  • Cross-border data exchanges
  • Increased use of mobile technologies by customers, including the rapid growth of the Internet of Things
  • Heightened cross-border information security threats

 

Although some organizations have started implementing the required measures to leverage advanced technologies and mitigate cyber-threats, more efforts are required to unearth and manage new risks inherent with these emerging technologies.

For example, the advancement in fields such as AI can lead to a more powerful attack as cybercriminals can corrupt ML algorithms’ training data sets easily by transferring biased data to it.

So, organizations need to catch up a lot for accurately addressing these security challenges. For consumers, security and data privacy form an integral part of FS solutions, and the onus for safeguarding the same lies with organizations. 

Going forward, being cyber-resilient against cybercrimes will be the key objective of enterprises to win customers’ trust and push the adoption of digital solutions.

3. Advancements in Robotics and ai Will Target Multiple Capabilities

The alliances of leading incumbent financial services and tech companies have already been formed to implement a combination of robotics and AI to address key pressure points, like - cost reduction and risk mitigation. They are targeting a specific combination of capabilities such as social and emotional intelligence, natural language processing, logical reasoning, identification of patterns and self-supervised learning, physical sensors, mobility, navigation, and more.

There are already some robots present around which can sense the details of their environments like recognizing an object, responding to information and objects with safe & useful behaviors. The biggest example of this is self-driving cars that have been performing very well in real-world tests. Although they are facing some technological hurdles right now three to five years down the lane, we can anticipate rapid gains as new models will combine increasingly powerful and standard modular platforms with the ability to learn.

4. Blockchain in Banking and FinTech

Blockchain has already garnered a lot of attention of multiple industries, as per this report, which states that 84% of respondents are actively involved with Blockchain Technology and also financial services is the most advanced industry in implementing blockchain systems.

Seven blocks interconnected to each other

Distributed ledger technology (DLT) enables simultaneous confirmations of all parties on the network and thus eliminates an entire layer of intermediaries who extract fees from each transaction they execute; thus reducing the considerable cost of infrastructure. This elimination is important as there were a large number of intermediaries involved in moving money, adjudicating contracts, among other activities.

For instance, the cross-border payments became highly inefficient as transactions had to pass through multiple intermediaries for authentication before reaching the end customer; resulting in huge delays and high costs. 

The Blockchain system has removed this layer to deliver payments to end customers in real-time and more securely. 

Similarly, it has revamped the clearing and settlement systems by putting securities on a common, decentralized ledger, thereby eliminating the need for middlemen and delivering services hassle-free.

Another important use case is the blockchain-enabled KYC utility. This will facilitate organizations to store customers’ KYC data from multiple sources in a single decentralized, secure database, and share access to third parties after obtaining due consent, leading to a decrease in duplication and lowered cost for the industry, robust AML/CFT checks and improved customer experience.

This video can further help you understand the FinTech trends that are shaping the finance and banking sector-

5. APis Will Foster Innovation, Speed, & Agility

Building applications by implementing APIs is now considered as the optimal way to address the business and economic challenges impacting the financial industry. FinTech startups have already revamped the landscape through the creation of mobile applications that have challenged and surpassed the banking industry. Using APIs will give an edge to dynamic small businesses by which they can innovate with speed and agility that even more significant and prominent sectors are unable to duplicate. Banks are now also joining this bandwagon by taking part in developer sandboxes and API economy. Due to the number of data banks have collected over the years, they are likely to regain dominance in this area. 

6. Human Digital Interfaces

While it's crucial for banks and financial institutions to implement digital strategy carefully, they can’t ignore technology for it has a huge role to play in augmenting the human experience and thus empowerment of both customers and employees.

Mobile technology has deeply rooted in our lives. For instance, we use our voices to give commands rather than touching our screens or typing. Also, passwords are now being replaced by biometric finger, retinal, or face scans as security checks. 

Consumers can use technology to get deeper insights into their financial situations. Especially when combined with AI and analytics, gamification and principles of behavioral science; the industry can sidestep their traditional role of just being the keeper of assets, and rather use trained bots to empathize, and understand regional and generational differences. 

Technology should be used to evaluate the emotional state of humans based on their interactions with the devices. For the next few years, expect to see these interfaces showing up in more places and being perfected.

Final Words

FinTech is an industry that will evolve continuously and stay at the forefront of innovation. Technology that would take years to design, test, and implement by large financial institutions, are now going from beta to real-world applications in a fraction of the time, by startups that are disrupting the financial industry in a big way.

They are unlocking potential which previously deemed unattainable, and also serving to demographics which was considered undesirable.

While security remains the topmost issue, it’s us, consumers, the winners, who are seeking the benefits; conveniences and functionality, in our banking and financial experiences, thanks to these trends in FinTech technology. 

Topics: Drupal, Cloud, Financial Services

Empowering FinTech Space With Drupal Modules & Distributions

Posted by Urvashi Melwani on Sep 22, 2019 3:25:00 PM

Though big data, AI, Cloud, blockchain, and open-banking have been here since quite a long time to transform the way financial services are designed and rendered, there is still a roadblock in the way ahead - core banking infrastructure.

Open-source banking can level the playing field and enable incumbent players to take advantage of these powerful trends and transformative technologies

Outdated architecture, costly licenses, specialized consultants-all of these hinder accessible FinTech services from keeping up the pace with current trends even in this era of smartphone ubiquity, where with one click, everything gets done!

Open-source banking can level the playing field and enable incumbent players to take advantage of these powerful trends and transformative technologies.

By leveraging common technology infrastructure, it can analyze the customer data and deliver a seamless banking experience via the mobile phone, leverage the power of the cloud, connect into a distributed ledger and digital payments, and more.

As per the PWC Report, there are over 80% of the financial institutions that believe business is at risk to innovators; 56% believe that they have put the transformation in their core strategy ; 82% expect to increase FinTech partnerships in the next three to five years, and 77% expect to adopt blockchain as part of an in production system or process.

Drupal is the perfect website content management framework to create open-source banking platform where it will not only reduce costs significantly, free up IT teams to focus on innovation but also enable greater security and extensibility to new devices and delivery channels.

Challenges Faced by FinTech Ecosystem

Though FinTech solutions have been doing the rounds for quite some time now in the market, there are a few constraints that are still stonewalling the industry’s growth. Some of these are underlined below:

  1. Market regulators

    1. Balancing data privacy needs with the industry’s requirement for open data
      Market regulators are having a hard time in striking the balance between consumer needs of data security & data privacy and industry’s need for open data for insight generation. Data privacy is critical to safeguarding consumers’ trust in the FS space, however, stringent practices on data sharing can hamper the free flow of data crucial for creating innovative solutions. Data privacy is critical to safeguarding consumers’ trust in the FS space
    2. Aligning with the anticipated risk associated with advanced technologies

      Market regulators need to match the pace with the fast-changing technology landscape to fully understand the evolving risks on the wider ecosystem. For example, cryptocurrencies could be used for money laundering, and AI-driven algorithm trading could lead to system-wide risks by increasing market unsteadiness.

      Also, AI-led models for credit assessment and underwriting could lead to a segment of one and end up pricing certain customer segments out of the market for good.
      Various elements and text in one rectangleSource: Mastercard

    3. Ensuring stability in the FinTech sector in this close network of world
      It’s evident that FinTech players have created a diversified FS ecosystem which has led to the strengthening in interconnectivity, but it has also brought forth new systemic risk by launching disruptive models.

      For instance, local regulators are grappling to supervise global technology firms who operate across multiple jurisdictions, leading to regulatory arbitrage.
  2. FS Incumbents

    1. Reskilling people for the modern digital world
      It is one of the key challenges that industry is right now facing and i.e., “How to adopt workforce re-skilling strategies to endure the technology-led revolution”?

    2. Regular monitoring of advanced technologies
      Such regulations have clipped conventional players’ ability to experiment with advanced analytical models in areas directly influencing customers
      The FinTech industry is finicky about consumer security necessitates that advanced models should be employed in sensitive areas such as lending pass the test of explainability to protect consumer interests. Such regulations have clipped conventional players’ ability to experiment with advanced analytical models in areas directly influencing customers.

  3. FinTech players

    1. Tackle the cyber-security concerns to gain consumers’ trust
      The advancement of technology has its pros and cons. And one of the cons is increased cybercrime! Its now FinTech players and their partners’ responsibility of ensuring that appropriate digital control measures are taken to secure customers’ trust and assets.
    2. Lack of early-stage funding
      Despite the FinTech space appealing sustained investments over the past few years, many smaller startups still struggle to gain early-stage capital, prohibiting their potential to scale up.
    3. Managing regulatory uncertainty
      Although Indian FinTechs have worked in an enabling regulatory environment, they still have not been resistant to regulatory uncertainties. Many FinTechs who had built their business models around Aadhar-enabled services for customer onboarding had to pull it out due to physical mandates, leading to the disruption in their operations.

How Drupal Modules can Power FinTech?

Organizations planning to or delivering FinTech solutions need to maintain a robust online presence. Drupal has been powering the landscape of FinTech with its extraordinary capabilities.

However, unlike with media publishing, education, or government verticals, which have dedicated distributions, there is no such scenario in FinTech.

The mentioned ones satiate the needs of consumers by providing related features with ease-

 

  1. Commerce PayPal
    Commerce Paypal incorporates PayPal into the Drupal Commerce payment and checkout programs. Currently, it lends support to:
    1. Off-site payment via PayPal Payments Standard (WPS) & PayPal Express Checkout (EC),
    2. Off-site or on-site payment via PayPal Payments Advanced (PPA),
    3. Payflow Link (PFL), and
    4. On-site credit card payment via PayPal Payments Pro (WPP).
      The PayPal WPS / EC Integration supports PayPal’s Instant Payment Notifications (IPNs) to respond to authorizations, captures, voids, and refunds with full logging for testing and debugging.
  2. Currency
    Currency
    takes this overwhelming task on it by converting currency with its inbuilt conversion and price display input filter.
  3. Commerce Paybox
    Paybox
    is integrated with Drupal Commerce payment and checkout system. It offers two mechanisms - Paybox service and Paybox Direct (PPPS), wherein former service offers a payment solution on its server and redirects customers to paybox.com during the payment process and the latter one supports on-site payments. This implies that payments are done on the Drupal site.
    Installing HTTPS before implementing this payment method is considered good practice to ensure security.
  4. The Google Currency Converter
    The Google Currency Converter module has integrated Google finance calculator within it to convert currency on the website. It also offers an option where you can set your default currency and default currency conversion format.
  5. Budget

    Users can set up a budget with this module to manage their finances. The list of requirements goes like this:
    1. Data Structure- Data will be broken down into four main taxonomy terms: income, expenses, debt, and savings. From there, sub-terms can be added by the site administrator to further classify data items. Main terms can also have sub-terms, where the user can enter their description.
    2. User-interface- The data entry will be a multi-part question and answer session, with help pop-ups to help users enter data and select sub-terms from a drop-down menu to manage their finances.
    3. Security- Appropriate measures will be taken to ensure the privacy and security of the user and their data. Only the user, system administrator, and financial adviser role will be able to view the individual user’s data and report.
    4. Recommendations- The finance recommendations will be based on the user data’s deviation from normal as a percentage of net income for his/her income group. Additionally, the site administrator will be able to set thresholds where red flags will be raised along with the description for the user to understand the reasons behind it.
    5. Aggregate Reporting- The module will produce aggregate reports in spreadsheets with 6 months cost projections. These reports will be exportable in excel spreadsheet format.
    6. Open Source- The module will be licensed under the GPL and contributed to the Drupal community.

  6. UC OmniKassa
    Integrate Rabobank OmniKassa  to make it as a default checkout method for UberCart.

    This module offers different payment configuration methods (iDEAL, Credit Card, transfer) to use via SHA-1 encryption for secure payment status verification. All settings are adjustable in admin form.

  7. Ubercart Affirm
    Affirm is an off-site payment method and a financing alternative to credit cards and other credit payment products. This project integrates Affirm Credit Payment Gateway into the Drupal Ubercart payment and checkout systems.

    Watch this video to understand further how technology is changing the Finance sector-

     

  8. Commerce Lending Works
    Lending Works
    aligns investors with borrowers directly who want to spread the cost of their purchase. It offers flexible finance on purchases from £50 to £25,000, without any hidden fees.

    This module is useful for a retailer in:
    1. Boosting sales- Finance services can shoot up retailers’ sales by 17% and order value by 15% on average.
    2. Refined customer experience- Customers enjoy the hassle-free process whether its online, in-store or over the phone.
    3. Rocket science made simple- The integration process is super-fast and provides round the clock support to help them analyze sales on one easy-to-use online account, or connect by API.
    4. Flexible finance - Split small purchases into 3 interest-free payments or Finance from 6 to 60 months on purchases from £250.00
  9. Drupal Finance
    Drupal Finance
    aims at providing complete business accounting and finance solution. However, don’t use it in production as it is in the very early stages as of now and entity schema will likely change without any prior information.

The following features are either currently available or are in development:

  • Organizations
  • Financial Documents Entity Type with Bundles
  • Supplier Entity Type
  • Financial Field Type to store the monetary value of a particular currency, along with performing currency conversion based on the primary currency of the organization.
  • Formula Field Type (experimental) which can be used to dynamically perform calculations based on mathematical equations and can contain Tokens to include values from other fields.

    It comes in handy where value is based on values of other fields, such as adding together an invoice total amount and tax.

    Integration with the Currency module, along with an Exchange Rates Plugin which provides real-time and historical exchange rates powered by ExchangeRatesAPI.io.

Distributions

  1. Guardr
    Guardr
    is a Drupal distribution made in combination with the modules and settings to upgrade the Drupal’s application security and availability to meet enterprise security requirements.

    Sufficient information must be fed to the system so that it can store it and compute it to prevent any service disruptions caused by power outages, hardware failures, and system upgrades.
  2. Droopler
    Droopler
    is a Drupal 8 distribution offers pre-built websites with complete functionalities so that you can tweak as per your requirements and get your good-looking website ready swiftly.

    Droopler is great for:
    1. Website factories - Used to build various microsites with editors having the power to edit content. Pick a theme to match your brand colors and get your website ready instantly.
    2. Corporate websites - Having a site is essential for all to stay in business but it's not necessary that all companies have an extravagant budget. Drooplers is a great start to create websites in a pocket-friendly manner.

      Custom Bootstrap 4 theme

      SCSS included and all variables & settings can be customized to match your needs.

      Built on Paragraphs

      Multiple boxes with lines drawn inside them
      Source: Drupal.org

      It uses Paragraphs module to create the pages. During the installation, you get one content type with various paragraphs (banner, feature list, text with an image on the site, headline text with background image), all themed and working exceptionally.

      Multi-language support

      Two languages are set by default for a demo with options to remove them/add more as in the case with any multilingual Drupal site.

  3. Seeds- Drupal Starter Kit

    Seeds is a light distribution which SMEs can use to kickstart their projects irrespective of scale to speedily complete their projects.

  4. Panopoly

    A base distribution of Drupal powered by lots of Chaos Tools and Panels magic enacts as both general frameworks for site-building and a base foundation upon which other Drupal distributions can be built. 

Final Words

Consumer demands are taking a paradigmatic shift- and FinTechs are iterating on the product quickly to get ahead of demands by offering alternative financing sources, branch-less banking, and more. However, there is no need for enterprises to reinvent the wheel to achieve the necessary objectives, as the tools and technology that they need to deploy, Drupal, Blockchain, Cloud, AI, & Big data are all available commercially and they can leverage it to scale a comprehensive data ecosystem using APIs while mitigating risk.

They will either demonstrate significant improvements in automation, digitalization, analytics, quality, security, and compliance or else they will go backward compared to their peer group.

Here is to the hopes of using better technology and getting great business outcomes in the year ahead!

Topics: Drupal, Planet Drupal, Financial Services

Understanding Data Engineering - Part 1

Posted by Surya Akasam on Feb 6, 2019 1:20:00 PM

The need to use the Big Data to make businesses progress towards data-driven decision making created data engineering and it is evolving at a rapid pace. “Data engineering” & “data engineer” are the relatively new terms and are extremely popular since the last decade. 

Tracing the History to Data

 

Before we dive deeper into Data Engineering and how it is impacting both centuries old businesses and startups equally, let's see the brief history of events to know how it evolved over a period of time. There’s a fascinating timeline by the World Economic Forum, and I am picking some critical moments from that list:

1958: Seed of Business Intelligence

IBM researcher Hans Peter Luhn defines Business Intelligence as “the ability to apprehend the interrelationships of presented facts in such a way as to guide action towards a desired goal.”

1965: Birth of First Data Center

The US Government plans the world’s first data center to store 742 million tax returns and 175 million sets of fingerprints on magnetic tapes.

1970 - The Birth of RDBMS

IBM mathematician Edgar F Codd [father of SQL] presents his framework for storing and retrieving the data called “relational database”

1976 - The Birth of ERP

Material Requirements Planning (MRP) systems are becoming more commonly used across the business world and evolved as Enterprise Resource Applications (ERP) as we know today, like SAP, Oracle Financials.

1991 - Birth of the Internet

Tim Berners-Lee posted a summary of the World Wide Web project on several internet newsgroups, including alt.hypertext, which was for hypertext enthusiasts. The move marked the debut of the web as a publicly available service on the internet.

1997

Michael Lesk publishes his paper "How Much Information is there in the World?" estimating 12,000 petabytes and the data is growing at the 10X per year and says that this data is just collected and not been accessed by anyone and states that no insights can be derived from it.

Foundations of Big Data

1999

Association for Computing Machinery published an Article “Visually Exploring Gigabyte Datasets in Real Time" where the first time the world big data appeared and it quotes that “Purpose of computing is insights not numbers”

2000

Peter Lyman and Hal Varian tried to quantify the digital information and its growth in the world they concluded that “The world’s total yearly production of print, film, optical and magnetic content would require roughly 1.5 billion gigabytes of storage. This is the equivalent of 250 megabytes per person for each man, woman, and child on Earth.”

And

From 2005 the web 2.0 had played a key role for increasing the quantum if data collected on a daily basis.

The world’s servers process 9.57 zettabytes (9.57 trillion gigabytes) of information – equivalent to 12 gigabytes of information per person, per day), according to the "How Much Information? 2010 report".

Working with Big Data

With that said, it is understood that big data is a possible future which businesses cannot ignore and it is fundamentally changing the way how businesses operate. And it's time to believe that “data is new fuel” that runs the businesses. But this also means they have to figure out the answers to some of the common challenges around Big Data:

How to store big Data?

Traditional methods of storing the data in RDBMS is not possible. It may store the volume & velocity Data, but it falls short in the variety aspect, because RDBMS is designed as transactional store (OLTP) and it expects the data to be in particular schema.

How to Process Big Data?

Traditionally data warehouses were designed to mine large amounts of data for insights and they work on the principle of ETL (Extract, Transform & Load). It expects data to be a particular schema; hence it also shortfalls in a variety of data storage.

How to collect real-time Big Data?

Real-time data is crucial is businesses want to shit from instinct, to predictive and proactive decision making.

The need for busineese to leverahe BigData gave rise to NoSQL (document, key value & graph-based), the cloud, data lakes etc. which were unheard of a decade earlier, and a need for professionals like data scientists, data engineers and cloud architects.

Understanding the Data Engineer

Data Engineering is a practice which creates a structure for how Big data is collected, maintained and shared with different stakeholders, so they can derive business value from it.

A Data Engineer is the person responsible for the building these structures.

Data Engineer Vs Data Scientist

Data Scientist is a role that people often confuse with Data Engineer.

It is an agreed fact that there are some technologies they commonly use between them, but they are very different role serving different purpose

Basic differences between Data Engineer & Scientist

1. Data Engineer creates/provides the structure & process how the data will be collected, processed and shared with the stakeholder. A Data Scientist on the other hand, is the stakeholder who uses that data to provide insights that business, by leveraging statistical models.

2. Data Engineer core competencies include distributed computing, data pipelines, and advance programming. For data scientists, core competencies include machine learning, artificial intelligence, statistics & mathematics.

A data scientist role is much fancied these days. But a data scientist is only as good as their data. That that’s taken care of by the data engineer.

With some of the basic definitions and differences out of the way, the next part of this blog post will discuss “How a Data Engineer can use Cloud to create Data Lakes”, which is at the core building a Big Data practice at any enterprise. 

Topics: Financial Services, Data Engineering & Analytics

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