Microsoft has offered the following guide on the potential use-cases of RAG in the financial services industry. These applications are supported on the Microsoft Azure stack.
The RAG approach for financial analysis
Consider the world of financial data analysis for a major corporation—an arena where accuracy, timely insights, and strategic decision-making are paramount. Let’s explore how RAG use cases can enhance financial analysis with a fictitious company called Contoso.
1. Summarization and Q&A
- Scenario: ‘Contoso’ has just concluded its fiscal year, generating a detailed financial report that spans hundreds of pages. The board members want a summarized version of this report, highlighting key performance indicators.
- Sample prompt: “Summarize the main financial outcomes, revenue streams, and significant expenses from ‘Contoso’s’ annual financial report.”
- Result: The model provides a concise summary detailing ‘Contoso’s total revenue, major revenue streams, significant costs, profit margins, and other key financial metrics for the year.
2. Data-driven decisioning
- Scenario: With the new fiscal year underway, ‘Contoso’ wants to analyze its revenue sources and compare them to its main competitors to better strategize for market dominance.
- Sample prompt: “Analyze ‘Contoso’s revenue breakdown from the past year and compare it to its three main competitors’ revenue structures to identify any market gaps or opportunities.”
- Result: The model presents a comparative analysis, revealing that while ‘Contoso’ dominates in service revenue, it lags in software licensing, an area where competitors have seen growth.
3. Personalization
- Scenario: ‘Contoso’ plans to engage its investors with a personalized report, showcasing how the company’s performance directly impacts their investments.
- Sample prompt: “Given the annual financial data, generate a personalized financial impact report for each investor, detailing how ‘Contoso’s’ performance has affected their investment value.”
- Result: The model offers tailored reports for each investor. For instance, an investor with a significant stake in service revenue streams would see how the company’s dominance in that sector has positively impacted their returns.
4. Automation
- Scenario: Every quarter, ‘Contoso’ receives multiple financial statements and reports from its various departments. Manually consolidating these for a company-wide view would be immensely time-consuming.
- Sample prompt: “Automatically collate and categorize the financial data from all departmental reports of ‘Contoso’ for Q1 into overarching themes like ‘Revenue’, ‘Operational Costs’, ‘Marketing Expenses’, and ‘R&D Investments’.”
- Result: The model efficiently combines the data, providing ‘Contoso’ with a consolidated view of its financial health for the quarter, highlighting strengths and areas needing attention.