Nov 25, 2003 (11:11 AM EST)
Fraud Spurs European Analytic Spending
Read the Original Article at InformationWeek
Driven by regulatory compliance and risk management needs, European financial services institutions will spend $4.8 billion on business intelligence and analytic technologies by 2006, according to a new report from Datamonitor, Business Intelligence and Analytics in European Financial Services. As with their U.S. counterparts, European FSI spending will be catalyzed specifically by anti-money laundering efforts, reports Daniel Lessner, associate analyst in London- based Datamonitor's financial services technology practice.
"Part of the reason why these areas will experience growth in the next few years is due to the recent issuance of regulatory requirements," says Lessner. "The deadline for putting the EU's anti-money laundering directive into national law has passed. Also, FSIs are facing domestic national regulations."
The study-which divided business intelligence and analytics into six solution areas, including customer intelligence, risk management, fraud, performance management, financial analysis and compliance-found that fraud will be the third-strongest catalyst of growth in spending. Tools purchased for fraud detection are expected to have a CAGR of 7.5 percent between 2003 and 2006.
Insurers will contribute to this trend despite the fact that "insurance carriers are still a little behind (other FSIs) when it comes to their use of analytics," relates Lessner. Their investment is driven by the fact that European insurers "are losing a lot of money because of fraudulent claims.