Project to reduce risk in finance

Data

A Southampton research team has been awarded £400,000 by the Shenzen government in China and Audaque Ltd, one of the world’s most innovative data management companies, for their project to build a big data-supported financial services platform.

Layering academic, technical and industrial expertise, the project aims to develop a sophisticated system that can process massive quantities of financial data from banks, securities institutions, small-loan companies, peer-to-peer (P2P) and people-to-business (P2B) internet finance companies to support decisions made by financial institutions.

The challenge is to build a sophisticated data platform applicable internationally, which brings together data management and financial assessment of individuals’ risk in real time. The University’s longstanding partnership with top financial firms in London will help ensure its functionality.

The team, comprising Professor Johnnie Johnson, Professor Vanessa Sung and Dr Tiejun Ma of the Centre for Risk Research at the University’s Southampton Business School, has ambitious plans.

“We want to be a one-stop shop. Ultimately, we aim to influence how financial authorities and others form and manage risk-management policy. At the moment, assumptions and decisions are made in the context of a shifting financial situation and are often ad hoc. When something goes wrong – the 2007 crash, for example – the system is fragile and liable to collapse,” says Tiejun.

The platform the team is proposing will significantly reduce risk and increase stability, improving social efficiency and people’s life experience without comprising business, economic and social sustainability and security, he explains. “In particular, the accurate assessment of risk will enable damaging systemic risks, such as that posed by sub-prime lending which led to the financial crisis, to be avoided. Our platform will contribute to the resilience of the global economic system.”

“This is a truly international, collaborative project which brings significant opportunities for Southampton,” says Tiejun. “The University is uniquely placed to tackle the current problems with big data analysis – misinterpretation, modelling and speed – and to build a platform that enables the accurate financial assessment of individuals in real time.”

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