At TRaiCE, providing value to our customers has always been a foundational principle. Trying to make life easier for financiers everywhere is what motivated us to build a cutting-edge financial risk mitigation system in the first place (read our About Us page for more details on that). It's why we designed TRaiCE in close collaboration with finance professionals, finding out their problems, and designing our system to solve them. To us, being successful means, first and foremost, solving our customer’s problems and providing value to their business. And we’re proud of the methods we use to do just that. In this blog, we will walk through the key TRaiCE features we are most proud of. This is not a comprehensive list of everything our system can do but represents the unique selling points that set us apart from our competitors.
4 Key TRaiCE features that set us apart from our competitors
1. Real-time risk monitoring
Gone are the days when monitoring borrowers with outdated risk profiles was the accepted norm. The unexpected market volatility that came with the Covid-19 pandemic has revealed the ineffectiveness of relying on that methodology, both in terms of risk monitoring adaptability and accuracy. In these ever-changing times, it is important for lenders and insurers to make more frequent risk calculations to get a current picture of their borrower’s business health.
In addition, risk managers must also use more data in these calculations if they want to improve the accuracy of their existing risk models. Fortunately, there are literally terabytes of data available today. Unfortunately though, current legacy risk monitoring systems are poor at handling these mountains of information. This can result in risk calculations that take too long to compute, leaving financiers with stale results that keep them constantly behind the curve. The only way to speed things up here is to reduce the amount of data used in these systems. This in turn reduces its preciseness. This undesirable trade-off between speed and accuracy greatly reduces the efficiency of such systems.
Conversely, because it is an AI-augmented system, TRaiCE users don't have to choose between speed and accuracy. They get them both! The system handles the prescient need to carry out intraday risk analysis with ease as its proprietary algorithms can process datasets with a wealth of parameters in them. That it can do this in mere minutes is what allows managers to keep a constant, daily eye on their borrowers.
The TRaiCE USP: TRaiCE gives users ongoing and continuous early warning risk information making it far superior to systems that monitor risk by pulling reports and invoking APIs only periodically.
2. Early risk detection and warnings
Another potent weapon in the TRaiCE arsenal is its early risk detection and warning system. With the rise and rise of black-swan events such as the ongoing pandemic, being able to identify and flag risk-prone entities quickly is the risk mitigation need of the hour. For this to happen, risk managers need to move beyond the qualitative analysis of entities. Historical data in the form of financial reports and account transactions have long been the mainstay of risk calculations. However, given how much alternate data is available today, relying only on this information to make risk assessments is imprudent. As the term suggests, historical data is always a good 6 to 12 months old. So, systems that depend mainly on past documentation give only backward-looking risk monitoring.
Worse still, these systems only allow for a simplistic type of assessment that is limited in scope and can be applied to a few scenarios only. Conversely, by including alternate data in risk calculations, financiers can broaden the scope of their risk assessments and improve their ability to make risk predictions. This gives them more agile and forward-looking risk monitoring. TRaiCE delivers this important feature in spades. Its powerful algorithms can capture internal data and combine it with extensive external data sources to proactively identify entities that are likely to default 3 to 6 months in advance.
What’s more, TRaiCE’s ability to work with an exhaustive set of data points – be it internal, external, structured, or unstructured – ensures that these predictions are more accurate to boot. In an industry where false positives and false negatives are an unwanted reality, this is an absolute game-changer. In addition, TRaiCE has an advanced and exhaustive rules engine that allows it to flag different risk scenarios - from Chapter 11 risk to fraud and AML detection. The customizable nature of our models means that we can seamlessly add any risk category that our customers want to monitor.
The TRaiCE USP: TRaiCE gives users gap-free risk monitoring by extracting early warning, red flag signals from comprehensive and up-to-date datasets.
3. Business sentiment tracking
The risk profile of a company is not just about its financial transactions anymore. In today’s hyper-connected world, it is an amalgamation of everything from employee morale to customer reviews and a whole lot in between. This is what makes the sentiment analysis of textual data in the form of news articles, analysis reports, blogs, and social media posts such a burgeoning and important part of risk monitoring. Sentiment analysis can give risk managers insights that traditional data cannot. More importantly, it can also often reveal the probability of future risk at an early stage (for more details on this, read our blog on sentiment analysis).
That said, given the immense wealth of textual data that is available today, performing manual sentiment analysis on all of it is an impractical undertaking. This leads to a process of selective and subjective data analysis where the analyst's gut feelings play a starring role. Furthermore, from a financial risk monitoring point of view, extracting overall article sentiment isn’t enough. For example, an article on the issues of diversity in tech will have an overall negative sentiment attached to it. But, if a tech company with an inclusive recruitment policy is featured favorably in the same article, the public sentiment towards that company is likely to be positive.
This is where TRaiCE goes above and beyond what most of our competitors provide. While most systems stop at providing an overall article sentiment, TRaiCE can sift through all the noise and zero in on what matters most to financiers – the business impact of the text. In other words, TRaiCE susses out if the textual data will affect a borrower’s creditworthiness or not. TRaiCE gives financiers the ability to track borrowers at a granular level without having to spend the time doing the time-consuming research this kind of focused tracking requires.
The TRaiCE USP: TRaiCE gives users objective and comprehensive data analysis taking it a cut above systems that perform only a subjective examination of the available data.
The last, but certainly not the least, way that TRaiCE makes life easier for investors is by automating the entire process of risk monitoring. The challenge with having an early warning system that gives daily and complete risk monitoring is that it needs tens of thousands of data points to monitor risk effectively and accurately. Real-world data comes in many forms and has multiple sources. TRaiCE takes care of the time-consuming but important step of data collection by automating the integration process with third-party APIs such as credit bureau reports, stock market indexes, and public or commercial data APIs.
Next, TRaiCE cleans, validates, restructures, and labels all this disparate data transforming it from a useless mush pile of ones and zeros to an organized directory of useful information. It then processes this data and extracts actionable insights from it. And all of this is done almost instantaneously so you have the requisite information at your fingertips anytime you want it. The only work you need to do now is to look at the system-generated alerts and make a well-informed business decision.
The TRaiCE USP: Get a risk monitoring system that automates the entire process of subjectively and quantitatively analyzing borrowers.
Our mission at TRaiCE is to become the de facto financial risk monitoring system of choice for financiers everywhere. We know that turning this dream into a reality will take much more than self-belief and ambition (both of which we have plenty of!). In the end, it’s the value-add that our customers get from using TRaiCE that will make all the difference. That’s why we’ve designed a fully automated system that does all the heavy lifting to provide you with quantitative, data-backed, on-demand, forward-focused, and gap-free risk monitoring. If you’re in the market for an efficient financial risk monitoring system, schedule a demo with us today. We would love to show you how and why we are different from the rest of the pack.