At one of the sessions of the just concluded Social Media Week Lagos a panelists brought the issue of data to the fore by observing that one of the major challenges facing tech start-ups in Nigeria is the lack of data scientist.
Data science or data-driven science refers to an interdisciplinary field of scientific methods, processes, algorithms and systems to extract knowledge or insights from data in various forms, either structured or unstructured, similar to data mining.
All that may sound confusing to someone who is not acquainted with the basic word ‘data’. Data is defined as facts or figures, or information processed or stored by computer. This may be in form of text documents, images, audio clips, software programs or other types of data. For businesses, the customers’ information they collect through various mediums are forms of data in its raw form. Raw data is data in its most basic digital format.
Growing adoption of fintech services in Nigeria means that a lot of raw data is being housed by operators. But like banks which has accumulated a lot of data, only a few of the players has actually made efforts to process and utilize their data banks for analytical purposes in order to understand their customers and provide competitive services.
Despite possessing enormous amount of data with the potential to tilt the competition in their favour, many fintech companies in Nigeria are distracted by venture capital funding and getting more customers.
However, analysis and prediction – two important components of data science – are critical to enhancing product value for customers. Around the world, companies of all sizes and across all industries are seizing upon this opportunity.
Many of them have gone even further to integrate artificial intelligence (AI). In fact, spending on AI-related hardware and software is expected to exceed $57.6 billion in 2021, as compared with the $12 billion that was spent in 2017, according to IDC.
For Nigerian fintech the next frontier is data and not mobile phones as has been forecasted. The reason for this is simple; mobile phones as a technology is still evolving and no one really knows the shape and form they will take in the next ten years. To be sure there will be new innovations for communication that could take the shine off mobile phones.
But data whether in its raw or processed form will remain relevant. The ability to process raw data particularly will be key to bringing the millions of Nigerians that are unbanked to access and enjoy affordable and convenient banking services wherever they are. The ability to capture this market is for the fintech firm that is able to maximally utilize.
More than anything else, and as societies emerge into the era of data responsibility, Nigerian fintechs will need to become a social, ecological and economic ecosystem driven by dataand the discipline of data analytics.
Data processing and analysis can help fintech firms in credit scoring and customer acquisition. One of the most important aspects of data processing is the potential to know the customers’ needs, preferences and complaints across a very wide spectrum of organizations in any specific business sector.
