Leverage IPA to Drive Financial Institutions Growth

If you think your financial organization is suffering from endless operational efficiency problems, you’re not alone. 81% of banking executives are overwhelmed by the rapid shift to technological disruption. What if the process evolves on its own and exceeds efficiency?

With large amounts of unstructured data coupled with traditional approaches, BFS institutions face an increasing number of document processing and governance challenges. Streamlining big data, protecting against data breaches, delivering personalized services, and investing in the latest technology are just a few of the factors impacting banking and finance executives.

Leveraging the core strengths of AI, RPA, and Human Intelligence, Intelligent Process Automation (IPA) helps unlock your organization’s true potential through self-learning processes that lead to increased productivity, ROI, and risk management.

It doesn’t stop here. Your business is powered by fully digital processes that improve customer relationships and open new avenues for innovation. What is stopping banks and financial institutions from going digital through automation? How will automation help the BFS sector?

Biggest Challenges for BFS Agencies Driving Automation

Due to the benefits of AI and RPA technology, many financial institutions are interested in IPA technology, but face unprecedented challenges. Let’s take a closer look below.

Challenge 1: Change customer behavior

In the post-COVID-19 era, BFSI leaders cannot expect their customers to return to traditional interaction channels. Customers have become more digitally informed and have come to expect complete transparency, flexibility and security from their banks and financial institutions, not to mention contactless payments and personalization.

Challenge 2: Strengthening Regulations and Control

In recent years, the number of regulations has increased significantly. However, the influx of new regulatory requirements continues unabated. Global banks must comply with over 120,000 pages of regulations. Many new regulations are extensive and constantly changing, yet banks must comply with strict deadlines. In addition, bank compliance officers closely monitor current regulatory obligations, related processes and controls. But when the emphasis is on bank compliance, that’s only half the battle. Regulation requires a wealth of data and documentation from various policy makers. Data must be made available by updating applicable organizational procedures, controls and policies. Failure to comply can result in significant fines.

Challenge 3: Scalability and Profitability

Banks and financial institutions strive to grow strategically without exceeding a sustainable pace or exceeding their organization’s risk tolerance. When it comes to M&A, the consolidation of disparate operating systems, technologies and workforces is a factor of concern, especially when these system models are poorly documented or understood across the organization. Alternatively, in the case of profitability, the challenge is to change without abandoning existing lines of business and to innovate without delving into processes.

Challenge 4: Changing workforce dynamics

BFSI leaders face significant challenges in managing their workforce. According to Quantum Workplace data, only 50% of employees in the banking sector are actively involved, while 35% are at risk of retention.

Many employees struggle to manage consumer concerns because of the siloed systems, processes, and technologies that have long been part of the banking and financial services industry (BFSI). Studies show that employees spend more than three hours each day on manual, repetitive tasks that are not part of their primary job, resulting in low morale, poor performance, inconsistent results, and fatalities.

Challenge 5: Fintech success

The digital transformation of financial services is accelerating, but these initiatives are often slow, limited and piecemeal, leading to pervasive and pernicious “technology traps”. As a result, many banks are not realizing their full investment potential.

BFSI leaders need to get out of the tech-trap mindset as digital transformation takes hold and opportunities for change narrow. Now is the time for banks and financial institutions to develop clear and actionable plans.

Translation: Instead of automating a few tasks, end-to-end automation powered by technologies like RPA and Intelligent Automation should be the core priority for these institutions.

How Intelligent Process Automation Helps Overcome the Challenges Above

COVID-19 has become one of the most important catalysts for digital innovation in financial services. Given the challenges, it is not enough for banks to simply make it available to their customers. Ensuring compliance, offering personalized solutions, and providing human contact at every touchpoint are key factors. To achieve this, incorporating RPA + IA into the BFS operations is a top priority.

Let’s take another look at how Intelligent Process Automation (IPA) can help companies digitally transform.

Scaling process operational efficiency

A successful IPA implementation can help companies improve efficiency and productivity in several ways. Leading banks around the world are making headlines by using Robotic Process Automation (RPA) to minimize labor costs and improve operational efficiency. Axis Bank and Deutsche Bank attracted attention for their use of RPA-based business automation. The various added value of this technology makes it one of the most popular technologies in the BFS industry.

Revitalize the customer experience

Data is one of the most powerful elements in the digital world. As a result, many banks and financial institutions are turning to data and AI-powered automation to improve all aspects of the customer journey. A notable example is Erica at Bank of America.

Bank of America’s Erica has grown dramatically with artificial intelligence-based virtual assistants, and within a year it has over 7 million users. While it is used to offer on-the-go access to accurate information, it has been expanded to include smart insights and eventually personalized data based on each users’ banking habits.

By intelligently gathering data, applying ML, leveraging bots to improve interactions and improve customer service and engagement, IPA bridges the gap between what customers need and what they can provide. In addition, RPA technology automates rule-based processes to handle user requests in real-time, improving decision-making skills while reducing turnaround time, and leveraging NLP to make bots more like humans. Also, wherever required it’s very possible to bring a human in the loop to manage.

Improve compliance, improve regulatory reporting and reduce risk

Due to the nature of their business, banks and financial institutions are subject to strict oversight and regulation. Intelligent automation technology reliably tracks multiple regulatory changes, uses AI to identify risks, and develops custom workflows that enable compliance while reducing risk without regulatory reporting errors.

Technology-agnostic RPA combines data from disparate legacy systems and presents it in the desired format. It reduces chunks of time required for processing large amounts of data, even if the data across the system is not in the same format. Protect banks and financial institutions by tracking all payments in real time, triggering alerts on potentially fraudulent transaction patterns, and minimizing response times. RPA can help prevent fraud by restricting accounts and stopping transactions in certain circumstances. Additionally, AI technology enables support for a variety of risk assessment and reporting operations, including preparation of official reports.

According to McKinsey, one bank across financial institutions saved 30% on key financial processes while reducing error rates. In addition, reducing the time and effort required to complete credit checks has reduced operational risk, improved control, and improved compliance.

Improve employee experience

Leverage automation when hiring top talent. Automate manual tasks and free up manpower for valuable work.

Bankers deal with large amounts of consumer data, and legacy systems are prone to breakdowns. Banks around the world are looking at RPA to reduce manual data processing and eliminate errors. Using bots to automate such tedious tasks can reduce processing costs by 30% to 70%. Banks can automate multiple banking processes and free up employees for more important tasks.

For example, Deutsche Bank’s intelligent automation software uses both optical character recognition (OCR) and machine learning technology to automate data capture from large volumes of documents, saving millions of euros. Your team can focus on more important tasks while saving money. The bank also adopted intelligent business automation technology to speed up document retention. Another successful implementation includes Bancolombia, the 10th largest financial institution in the world, automating BPM. Hundreds of activities in customer care, credit checks, payments and settlements, and the stock market are automated by bots. The company saved 127,000 hours and improved customer service effectiveness by 50%.

Make your business processes work. Get smart today!

By harnessing the power of AI and RPA, banks can do more with fewer resources while reaping economic returns. Transform complex processes, improve CX, eliminate costly errors, and improve business efficiency with Intelligent Process Automation.