AI, Big Data and Finance: Technology at the service of small investors

At Inversa, we connect Big Data and finance to provide savers with critical investment data and help them get the most out of their money

Although today we use the concept of technology more than ever, the reality is that technological advances have been present throughout history. Indeed, disruptive technologies such as the wheel and the printing press helped transform the world and helped civilization evolve. The same can be said of the significant innovations of our time, such as Artificial Intelligence or Big Data. These technologies are set to change how we live, produce, consume and relate to each other forever.

The relationship between Big Data and finance is forever changing how we access and operate in the financial market. Why? Thanks to data analysis, we can assess the risk of financial operations and study players’ behavior in a field as important as investment.

To the Big Data and finance binomial, we must add Artificial Intelligence to facilitate investment and consolidating technologies such as Blockchain that contribute to securing operations.

Technology has advanced so much that today, a person can invest in a company located thousands of kilometers away automatically, without having to actively and constantly intervene, and with all the critical information at their fingertips.

In this article, we will analyze the relationship between Artificial Intelligence, Blockchain, Big Data and finance and how this relationship facilitates access to the investment market for thousands of small savers.

Finance and technology, a vital marriage of this era

Before talking about Big Data and finance, we must highlight an obvious fact: technology is essential in all productive sectors, but it is vital in the financial sphere. Few sectors are more digitized than banking. In fact, beyond the digital transformation of traditional institutions, in recent years, there has been a proliferation of start-ups focused on developing technological solutions in the financial sector: FinTech.

As their name suggests, these projects merge technology and finance to offer people and companies solutions and products that can be useful to them. What kinds of FinTechs are there? Financial advice companies, companies focused on personal finance, alternative financing platforms such as Inversa Invoice Market, mobile applications for payment services, such as the well-known Bizum, companies that integrate Big Data and finance by analyzing a large amount of data, companies focused on the management of crypto-assets and the use of technologies such as Blockchain…

The typologies are multiple and are expanding day by day.

FinTechs and traditional entities with technological divisions are at the forefront of applying innovations and digitalization to offer companies and citizens a massive catalog of services and products.

AI, Big Data and finance is a key relationship in understanding how the investment industry has evolved in recent years

Complex developments to offer simple solutions

One of the keys to the platforms, solutions, tools and applications increasing in the financial sector is their usability. An investment platform offering attractive products for companies and savers is only possible if it is possible to use or requires advanced financial knowledge.

The success of FinTech and companies that combine Big Data and finance is that they use cutting-edge technology to simplify their operations as much as possible and take care of the user experience.

The more user-friendly an application or platform is, the more willing a person will be to use it and the lower the learning curve they will face to get the most out of it.

Why did Bizum succeed? Because it allows us to pay for our share of a dinner with friends in a matter of seconds, without bureaucracy, without having to go through many steps, without complications.

The best developments use cutting-edge technologies to turn the complex into something simple and usable.

Big Data and finance: The financial information that the data hides

Why is the relationship between Big Data and finance so meaningful? Because it allows us to convert the immense amount of data recorded by FinTechs and traditional institutions into information vital for companies and investors.

For example, at Inversa, the relationship between Big Data and finance results in two analyses that help savers decide which invoices and promissory notes of companies offered on the platform to invest in and which not to invest in:

  • Internal financial analysis. Thanks to Big Data and Artificial Intelligence, the information on the companies issuing invoices is analyzed quickly and securely and compared with the ratios and indicators of their economic sector. This analysis complements the external credit rating reports from benchmark companies committed to the relationship between Big Data and finance.
  • Repayment analysis. Big Data technology is also used to analyze the behavior of the transferor and drawee companies operating on the platform, considering the number of invoices traded and the degree of compliance with the commitments made, to inform investors if some companies are habitually late in paying their invoices.

Before the advent of Artificial Intelligence and Big Data, companies operating in the financial sector needed help to analyze their vast amounts of data. Today, however, financial information can provide certainty to companies seeking finance and investors looking to make a return on their money.

FinTechs merge Big Data and finance to offer products accessible to small investors

Blockchain technology: A virtual notary to register contracts

Another cutting-edge technology used in finance is the Blockchain. Why? It allows payments and transfers to be streamlined and agreements to be executed automatically.

Blockchain helps to encrypt information as sensitive as financial information and record it in an immutable and perpetual way; this technology is considered to play the role of a virtual notary in financial transactions and contracts, ensuring that the record is reliable and able to withstand attacks that seek to manipulate the data.

In the case of Inversa Invoice Market, blockchain technology is used to register the contracts generated on the platform after they are electronically signed through their hash on the blockchain chain in such a way that this record functions as a timestamp.

Moreover, once the hash is embedded in the Blockchain, it cannot be altered.

If the relationship between Big Data and finance provides investors with guarantees and provides information of great added value for financial operations and investments, blockchain technology contributes to securing transactions.

Artificial Intelligence to automate investments

Data analysis, transaction security… what other process can be carried out thanks to the technological tools of this era? The automation of tasks and actions. And in the field of investment, it is possible to help savers to automate their investments. How? Thanks to Artificial Intelligence solutions capable of processing people’s decisions and making investments according to them.

For example, at Inversa Invoice Market, investors have at their disposal Raimon, an investment automation assistant that is very easy to use.

Raimon guides investors through all the critical elements of an investment:

  • Amount of money you want to invest.
  • Risk they are willing to take.
  • Minimum return you want to achieve.
  • Time frame for return on investment.
  • Selection of specific companies in which you wish to invest.

Thus, up to 8 parameters make it possible to draw a precise portrait of the investments savers want to make.

Just as the combination of Big Data and finance provides data and analysis of enormous value for evaluating potential investments, Artificial Intelligence frees investors to apply their investment strategies after studying the parameters they have selected and comparing them with the characteristics of each potential investment.

In this way, Raimon can make investments that fit the wishes and objectives of each user of the Inversa platform without the need for them to be constantly aware of the invoices and promissory notes on offer. All of this translates into enormous time savings and, contributes to the success of investment strategies and providing continuity to the act of investing, transforming it into a habit that generates direct economic benefits.

In short, the relationship between Artificial Intelligence, Blockchain, Big Data and finance is essential when digitizing a driving sector of the economy and vital importance for the productive fabric.

FinTechs like Inversa base their value proposition on cutting-edge technologies to offer companies and investors advanced, elementary solutions. With what objective? To help businesses to finance themselves and investors to make their money profitable by reaping attractive interest rates.

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