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Journal for Studies in Management and Planning

Available at

http://edupediapublications.org/journals/index.php/JSMaP/

I SSN: 2395-0463

Vol ume 04 I s s ue 02

Februa ry 2018

Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 23

capabilities discovery problem and via following the formal steps of the KDD procedure. Each

industry obstacle (actual-world software) can be matched by way of many data-mining tasks

relying on how we technique the hindrance. We in shape our real-world application (assessing

comparatively the performance of non-financial institution fiscal associations) with both DM

clustering and classification tasks.

2. Recent Trends in Non-Banking Financial Institution:

2.1 Regulatory changes and complexity

Since the financial crisis, regulatory pressures have increased the cost of capital, prompted banks

to divest themselves of 'risky' or capital intensive businesses or departments, shaped bank

attitude towards risk and redrawn the boundary between retail and wholesale banking. Banks

have withdrawn from lending to certain constituents, such as SMEs and infrastructure, whilst

investing and recruiting heavily in compliance to meet new regulatory requirements.

Amidst this regulatory pressure, non-banking financial institutions, especially FinTech firms that

are not subject to the same financial pressures, are offering competing services to bank clients,

establishing specific funds or investing in new challengers.

2.2 Digitalisation and technological advances

Technological advancement is changing financial institutions and the ways people interact. It has

created opportunities for new challengers to disrupt traditional business models and penetrate

new markets. The ubiquity of technology across the globe, such as the World Wide Web, mobile

phones and Apps, has created FinTech companies who offer lower cost services for traditional

services, such as e-payments and online trading. Technology is changing the way that customers

interact with financial institutions. Although investment in IT infrastructure has increased

massively over the last few years, many traditional banks remain behind the curve. Social media

companies such as Facebook, Twitter and Google have a huge user base and are moving into the

financial sector, bringing new sources of capital and investment.

2.3 Changes in investment and capital sources and returns

Regulatory capital requirements are causing a drag on returns and taking significant management

time. Banks are complying with stress tests, responding to regulatory investigations or managing

increasingly punitiv e regulatory fines. Some non-bank financial institutions are more profitable

than banks and are as large and significant in terms of global stability. Entrants with lighter

regulatory burdens are moving into areas (insurance, lending, ownership of hard assets)

traditionally undertaken by banks, in a search for yield, and are creating or exploiting

opportunities. Non-bank financial institutions are investing in new challengers to banks. New

FinTech firms, providing financial solutions, are investing heavily and online only banking

ventures, or other platforms, are attracting investment and gaining traction.