How GIS Can Improve Banking Operations

Applied Tech Review | Tuesday, July 27, 2021

GIS technologies can help agricultural lenders to improve risk mitigation strategies, regulatory compliance practices, and other vital concerns.

FREMONT, CA: In the banking business and other risk-focused sectors, geographic information system (GIS) technology is employed in various ways.

Situations in agricultural lending are inclined to becoming increasingly difficult. Ag lenders must keep a close eye on significant weather events, region-specific water rights information, and regulatory transformations that can influence the farmland and parcels in their portfolios, and water security and commodity pricing, in addition to all the problems that conventional banks must be dealing with.

Ag lenders may struggle to make effective loan choices on time without the necessary data and a complete water risk assessment. Here are some of the advantages of employing geographic information systems (GIS) in banking, focusing on the agriculture sector and water security.

GIS Can Help Ag Lenders Solve Key Challenges

As GIS technology can be used in various ways, ag lenders may use it to solve their biggest problems. GIS technologies may be used to see and comprehend data on crop stress, soil health, water use and quality, and a slew of other variables, all presented in a simple and flexible interface.

Access to Water Risk Information

For starters, obtaining dependable water data remains a challenge for all stakeholders, from lenders and investors to farmers themselves. As water is a local resource with local challenges, risk mitigation solutions must be based on granular, on-the-ground knowledge. Otherwise, ag lenders who work in different regions or don't have access to historical water data for specific watersheds or parcels of land may find it challenging.

New Customer Acquisition

Ag lenders must maintain a competitive edge to retain borrowers and attract new ones. GIS offers lenders a competitive advantage by giving parcel-by-parcel information on water rights, land use, pumping restrictions, and other data.

Lenders can employ robust data and analytics capabilities previously only available to larger businesses by adding GIS into agricultural banking operations.

Geographic Expansion

Several lenders are focusing on new areas, which can bring a whole new set of obstacles in the shape of local environmental concerns, different types of water sources, state-specific legislation, and water rights regulations. GIS tools provide a convenient solution to this problem by allowing users to observe watershed boundaries and comprehend pumping regulations in groundwater basins even when they are not physically present.

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